Work Opportunity Tax Credit Best Practices From Belk

The Work Opportunity Tax Credit (WOTC) can create value for employers while supporting access to jobs for people who have faced barriers to employment, such as veterans, people with felony convictions, and members of other qualifying groups. But identifying eligible employees is only one part of the process. Employers also need a workflow that supports candidate participation, gathers required information, and helps teams meet deadlines.

Belk is a major department store chain that employs thousands of people across the U.S. In the on-demand webinar “Maximizing WOTC Savings: Insights From Belk’s Success,” I joined Cathy Halstead, vice president of associate relations, benefits, HRIS, HR shared services and payroll at Belk, to discuss WOTC fundamentals and the changes Belk made to improve its program. The conversation showed how better timing, mobile access, and automation can simplify the candidate experience and strengthen WOTC participation.

What is the Work Opportunity Tax Credit?

WOTC is a federal tax credit for employers that hire and employ people from certain targeted groups. The program expands access to jobs for people who have faced significant barriers to employment.¹

Target groups include qualified veterans, certain public assistance recipients, vocational rehabilitation referrals, qualified summer youth employees, and qualified long-term unemployed individuals, among others. Each person must meet the requirements for a specific category, and the appropriate state workforce agency must certify the new hire before an employer can claim the tax credit.

The potential credit varies by target group, eligible wages, and hours worked during the employee’s first year. As discussed in the webinar, the credit may reach $9,600 for an individual qualifying hire in certain veteran categories.² Employers should consult their tax professionals about eligibility, current requirements, and their ability to claim a credit.

How does the WOTC process work?

At a high level, the WOTC screening and certification process includes four steps:

1. Pre-screen the job applicant to identify potential membership in a WOTC target group.
2. Submit the required certification request to the appropriate state workforce agency within the required timeframe.
3. The state workforce agency reviews the request and determines whether the new hire qualifies.
4. If the new hire is certified, calculate the potential credit based on the qualifying category, eligible wages, and hours worked, then follow the applicable IRS claiming process.

The details can vary based on the person’s qualifying category and the employer’s tax status. Taxable employers generally claim WOTC as a general business credit against income taxes. Eligible tax-exempt employers may claim the credit against payroll taxes for qualified veteran hires. Employers should verify current IRS and state workforce agency guidance before acting.

Which employers should consider WOTC?

WOTC may be worth evaluating for employers that regularly hire new employees, are likely to hire people from eligible target groups, and have the tax position and administrative capacity to benefit from the program. HR, talent acquisition, payroll, tax, and compliance teams should review the opportunity together. That review can help the organization understand potential value, candidate impact, required deadlines, and ownership across the process.

Employers should also consider whether their current workflow makes participation difficult. A program may look valuable on paper but underperform if candidates leave the survey, forms are delayed, or teams lack clear responsibilities.

Why employers may miss WOTC opportunities

During the webinar, attendees identified several barriers to maximizing WOTC opportunities. Lack of awareness or training and low employee response rates ranked among the leading concerns. Time and resource constraints, manual processes, and integration limits were also common challenges.³

Candidate experience is often part of the problem. WOTC screening can add questions and time to the hiring process. Required paperwork may also request sensitive information, including a Social Security number and date of birth. When those questions appear during the initial application, some candidates may hesitate or drop out.

Employers should consider both what they need to collect and where the request appears in the hiring journey. A shorter, connected process can make the next step clearer for candidates and reduce work for internal teams.

How Belk created a smoother candidate experience

Belk previously included WOTC screening in its job application. According to Cathy Halstead, the process was cumbersome, and many applicants did not finish it. Some candidates were also concerned about providing sensitive information and how that information would be handled.

Belk moved WOTC screening out of the initial application and connected it with the background screening workflow through First Advantage Profile Advantage. After the employer ordered a background check, the candidate could receive a link by text or email. The candidate could then complete the background screening and tax credit steps through a connected process.

The workflow was also available on mobile devices. That was useful for Belk’s store-based hiring teams because a candidate could receive the link and start the process while still at the hiring location. Since candidates had already entered the screening workflow, moving into the WOTC survey felt like a logical next step rather than a separate request.

Belk’s reported results

Belk reported several improvements after adopting the connected workflow:

• Nearly all applicants began moving through the Profile Advantage process.
• Completed and filed certifications increased by more than 100% compared with the prior process.
• Fewer candidates dropped out or abandoned the process.

“When the applicant can go through the background process and then goes directly into the WOTC process, it’s smooth for the applicant,” Cathy said during the webinar.

Four WOTC best practices for employers

Based on our experience offering tax screening services and guidance to organizations, here are some best practices for streamlining the WOTC management process and improving the candidate experience.

1. Place screening at the right point

Review where WOTC screening appears in the candidate journey. Moving it out of the initial application may reduce early friction while allowing the employer to collect information at a more suitable stage.

2. Connect related candidate steps

A connected background screening and WOTC workflow can reduce separate systems and unfamiliar steps. It can also give internal teams a more consistent way to manage related hiring tasks.

3. Design for mobile completion

Many candidates complete hiring steps on a mobile device. A mobile-friendly process makes it easier to respond quickly and helps hiring teams keep the process moving.

4. Automate administrative work

Conditional questions can limit unnecessary steps by showing follow-up questions only when a response suggests potential eligibility. Electronic signatures and connected workflows can also reduce manual handoffs and support more consistent administration.

WOTC program checklist for employers

Use this checklist to review how your organization manages WOTC:

• Decide where WOTC screening should occur in the hiring process.
• Assign clear ownership across HR, talent acquisition, payroll, tax, and compliance.
• Confirm who manages pre-screening, certification requests, agency follow-up, payroll data, and tax reporting.
• Test the candidate experience on mobile devices.
• Track survey completion, candidate drop-off, certification volume, and potential credits.
• Verify current IRS and state workforce agency guidance, forms, and deadlines.
• Review whether the program supports long-term hiring and employee retention goals.

Is WOTC still in effect for 2026?

WOTC’s most recent authorization expired on December 31, 2025. As of the latest IRS and U.S. Department of Labor information reviewed for this draft, the program has not been reauthorized for employees who began work after that date.⁴ The webinar was recorded on January 22, 2026, so its legislative discussion reflects the information available at that time.

Program status, forms, and agency procedures can change. Employers should confirm current federal and state guidance and consult their tax or legal advisors before deciding on screening, certification requests, or potential credits. An organized process can help teams respond to changes without creating unnecessary disruption for candidates or hiring teams.

Watch the full webinar

Improving WOTC outcomes takes both sound administration and a candidate experience that encourages completion. Belk’s experience shows how timing, mobile access, connected screening, and automation can work together to reduce friction and support stronger participation.

Watch the on-demand webinar for the complete discussion of WOTC fundamentals, Belk’s approach and reported results, the candidate workflow, and the legislative landscape at the time of recording.

Watch Maximizing WOTC Savings: Insights From Belk’s Success

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