As of January 1, 2026, the Work Opportunity Tax Credit (WOTC) has entered a legislative hiatus. While this may sound like a full stop, it’s not. In fact, for employers who rely on this federal hiring incentive, now is the time to stay consistent—not pull back.
The program’s official authorization may have expired, but key compliance requirements are still very much in effect—including the IRS’s critical 28-day submission rule.
What Is the 28-Day Rule?
The IRS requires that employers submit Form 8850 (Pre-Screening Notice and Certification Request) within 28 days of an eligible employee’s start date. This rule applies regardless of whether WOTC is currently active or in hiatus.
If you miss that window—even by a single day—you forfeit the right to claim the credit for that hire. And if Congress later retroactively renews the program (as it has done many times before), those credits will be permanently lost.
Why Employers Lose Out During Hiatus Periods
At MJA & Associates, we’ve helped hundreds of companies navigate WOTC through more than one legislative lapse. And we’ve seen a common trend: when communication around the program stalls, so does employer action.
Here are the most frequent mistakes we see during WOTC pauses:
- Stopping the screening process altogether, believing there’s no point in continuing
- Delaying form submission, assuming it can be “caught up” later
- Believing credits can’t be retroactively claimed—which is only true if paperwork wasn’t filed on time
- Assuming automated systems are handling it, without confirming if forms are actually submitted to state agencies
These missteps all lead to the same outcome: preventable loss of tax credits that could have been preserved with timely documentation.
What States Are Doing During the Hiatus
Even though the Department of Labor cannot issue final certifications during a hiatus, most state workforce agencies are still processing WOTC applications. That includes:
- Reviewing submissions
- Requesting supporting documentation
- Verifying Employer Representative Declarations (ERDs)
- Preparing files for fast-tracked certification once legislation is reinstated
In other words, the WOTC pipeline is still flowing—it’s just paused at the final stage. If you keep your process moving, you’ll be at the front of the line when approvals resume.
How MJA & Associates Keeps You Compliant
MJA & Associates specializes in helping employers maintain WOTC compliance—even in uncertain times. We handle:
- Timely form submissions
- Documentation collection and verification
- Employee screening
- Communication with state workforce agencies
We operate on a contingency basis, meaning we don’t get paid unless you see results. That’s why we’re fully invested in protecting your potential tax credits now, so you’re not left scrambling later.
Now Is the Time to Stay the Course
It may feel counterintuitive to keep submitting paperwork for a paused program—but this is how you protect future value.
If you’re unsure how to proceed or want help reviewing your WOTC process, MJA & Associates is here to guide you. We’ve done this before, and we know what it takes to maximize your credits even in a gap period.
