|DATE: July 11, 2000 NO: 01-05||
CONTACT: Jeanne Walker Phone: (907) 465-5953
Department of Labor and Workforce Development
TAX CREDIT PROGRAMS SAVE EMPLOYERS NEARLY $2 MILLION
Federal Programs Provide Incentives to Hire, Represent Tax Savings
Alaska employers realized a potential of nearly $2 million in tax savings while more than 400 workers from target groups found jobs in FY 1999, thanks to two federal tax credit programs administered by the Alaska Department of Labor and Workforce Development.
"The federal Work Opportunity (WOTC) and the Welfare-to-Work (W2W) tax credit programs mean a great deal to Alaska employers and job seekers, " said labor department commissioner Ed Flanagan. "For employers, the tax credits represent significant savings, and for select groups of workers they mean not only jobs but new directions for their lives."
WOTC allows a tax credit of up to $2,400 on wages paid during the worker’s first year on the job. The W2W tax credit grants up to $8,500 over the first two years of employment.Both tax credits are available to private, for-profit employers who hire workers from specific, targeted groups who have difficulty landing jobs. Groups include TANF recipients, qualified food stamp recipients (age 18-24), qualified veterans (must be a member of a family that receives food stamps), qualified ex-felons (must be a member of a low-income family), vocational rehabilitation referrals, and Supplemental Security Income (SSI) recipients.
The labor department issued a total of 416 tax certifications during federal fiscal year 1999, representing a potential tax saving of $2,023,200. Employers apply for and receive certification for each worker they hire that qualifies for either tax credit. The tax credits directly offset federal taxes the employer may owe.
In December 1999, President Clinton signed a bill that extended the WOTC and W2W tax credits through December 31, 2001.
For more information about the tax credits, contact Jeanne Walker in Juneau at 907-465-5953, or email,Jeanne_Walker@labor.state.ak.us
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