As discussed in the First Advantage Tax Alert that was issued November 3, 2017, the House’s Tax Reform Bill had a provision that repealed the Work Opportunity Tax Credit (“WOTC”). The repeal would be effective for wages paid to qualifying individuals who begin work on or after January 1, 2018. Under the House Bill, employers would still be entitled to the credit in 2018 for qualified individuals who are hired on or before December 31, 2017.
Last week the Senate released its version of Tax Reform. In the Senate version, WOTC was not repealed. On Sunday night, Senator Portman (R-OH) proposed an amendment to the Senate bill that would actually amend Section 51 (the WOTC statute) to make WOTC permanent instead of expiring on December 31, 2019.
In a development yesterday, the Senate added the repeal of the Affordable Care Act’s individual mandate to the Senate Tax Reform Bill.
As expected, there have been and will be further discussions, negotiations and changes that occur in the upcoming weeks. The Senate and the House bills have major differences which will need to be addressed before any tax reform is passed. It may be late December before all of the conflicting issues are actually resolved.
First Advantage is continuing to work with the National Employment Opportunity Network (NEON) and as things develop and we will keep you updated. If you have any questions, please contact your First Advantage Tax Account Manager.