Serrano Encourages Use Of Work Opportunity Tax Credit

Senator Serrano joined Congressman Charles Rangel and local elected and business leaders to promote the federal Work Opportunity Tax Credit to hire young people ages 16 -24.

The tax credit for businesses helps provide employers with a one-time federal credit for each newly hired, eligible youth ages 16-17, now through September 15 and for young adults 18 through 24 for the first year. 

"This is not just an opportunity to fill an employment need, but also a chance to provide young people with an experience that can propel them to greater success. That is why the Work Opportunity Tax Credit is so important," said Rangel. "Employers are given a valuable resource to fill needed summer and part-time positions while our youth are provided with productive activities that help keep them out of trouble and enhance their credentials for entering the job market."

The WOTC is still largely underutilized across the city and state. While over 25,000 eligible youth live in Upper Manhattan, only 479 businesses have used the credit over the last two years.

"So much of community renewal is dependent on jobs," said Senator Serrano. "The ability to provide a sustainable source of income goes a long way toward improving public health, reducing crime, and ensuring that long-standing residents and their children can afford to live where they grew up."

Employers can learn more about the WOTC program by calling the New York State Department of Labor toll-free at 1-800-HIRE-992, or by visiting the Business Services section of the agency's web site at www.labor.ny.gov. Employers can check whether the residence of a prospective employee is within a designated community or zone by using the address locator available from the U.S. Department of Housing and Urban Development at http://egis.hud.gov.

To qualify for the WOTC, employers must hire young people who live in a designated Federal Renewal Communities and/or Empowerment Zones. The youth must be employed a minimum of 120 hours, part-time or full time.

The amount of the credit is based upon the total number of hours the youth is employed. If employment is between 120 and 400 hours, the maximum credit is 25% of the first $3,000 in wages, or up to $750. If employment is 400 hours or more, the maximum credit increases to 40% of the first $3,000 in wages, or up to $1,200. The average credit is roughly $500 per WOTC employee.

The credit also provides a one-time federal credit for each newly-hired, eligible youth ages 18 through 24. The youth must be employed a minimum of 120 hours for the first 12 months. (If employment is between 120 and 400 hours, the maximum credit is 25% of the first $6,000 in wages, or up to $1,500. If employment is 400 hours or more, the maximum credit increases to 40% of the first $6,000 in wages, or up to $2,400).