The Work Opportunity Tax Credit (WOTC) program has officially entered a temporary hiatus as of January 1, 2026. While this might sound concerning at first glance, there’s no cause for alarm. This isn’t the first time the program has experienced a gap in federal authorization, and it has always been renewed retroactively in the past.
At Worksite, we’re here to guide you through what this means for your business and your WOTC submissions.
What Is the WOTC Program?
The Work Opportunity Tax Credit is a federal tax incentive that encourages employers to hire individuals from certain targeted groups who face significant barriers to employment. It’s a powerful tool to both support inclusive hiring and earn valuable tax credits for your business.
As of now, the WOTC program was authorized through December 31, 2025. Since Congress did not pass reauthorization legislation before this deadline, the program is in a holding pattern.
What Happens During a Hiatus?
While the federal government sorts out the legislative process, here’s how things stand:
Hires on or before December 31, 2025:
Applications for employees hired before the expiration date will continue to be processed if they were submitted by the normal 28-day submission deadline. This means you’re still eligible to receive credits for 2025 hires.
Hires on or after January 1, 2026:
Applications for employees hired in 2026 will be held in pending status until Congress reauthorizes the program. Once the WOTC is renewed, these applications are expected to be processed retroactively.
What Worksite Is Doing
If you’re already using WOTC services through Worksite, there’s nothing additional you need to do right now. We will continue submitting all eligible applications on your behalf and tracking the program’s status closely. Our team is staying up to date with federal developments and will notify you of any changes that could impact your hiring strategy or tax planning.
Questions? Let’s Talk.
We understand that a lapse in WOTC authorization can raise questions. If you’re unsure how this affects your hiring or want help planning for the year ahead, our Compliance team is here for you. Reach out at Compliance@WorksiteHR.com or give us a call at 941.677.0110.
While legislative pauses like this one can be frustrating, they’re typically short-lived. With Worksite in your corner, you can continue hiring with confidence, knowing we’re keeping a close eye on the details, so you don’t have to.
