WOTC procedures during lapse for nonveteran groups

Accessible letter PDF: https://www.dol.gov/sites/dolgov/files/ETA/advisories/TEGL/2012/tegl15-11acc.pdf

CLASSIFICATION
EMPLOYMENT AND TRAINING ADMINISTRATION             WOTC
            ADVISORY SYSTEM                        CORRESPONDENCE SYMBOL
       U.S. DEPARTMENT OF LABOR                    OWI
          Washington, D.C. 20210                   DATE
                                                   January 24, 2012

ADVISORY:      TRAINING AND EMPLOYMENT GUIDANCE LETTER NO. 15-11

TO:            ALL STATE WORKFORCE AGENCIES
               ALL STATE WORKFORCE LIAISONS
               ALL REGIONAL COORDINATORS

FROM:          JANE OATES /s/
               Assistant Secretary

SUBJECT:       Work Opportunity Tax Credit (WOTC) Procedural Guidance During
               Authorization Lapse for Non-veteran WOTC Target Groups

l. Purpose. To provide information and procedural guidance to the State Workforce
   Agencies (SWAs) for processing requests for certification under the WOTC program
   after the December 31, 2011, expiration date for non-veteran target groups.

2. References.
    Veterans Opportunity to Work to Hire Heroes Act of 2011 (VOW to Hire Heroes
      Act) (Public Law (Pub. L.) 112-56);
    Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of
      2010 (Pub. L. 111-312);
    American Recovery and Reinvestment Act of 2009 (Pub. L. 111-5);
    Internal Revenue Code of 1986, Section 51, as amended;
    Internal Revenue Service Notices 2009-69, dated August 31, 2009 and 2009-28,
      2009-24 I.R.B 1082, dated June 15, 2009;
    Training and Employment Guidance Letter (TEGL) 03-09, Information and
      Guidance on the Two New Work Opportunity Tax Credit (WOTC) Targeted Groups
      Introduced by the American Recovery and Reinvestment Act of 2009;
    TEGL No. 11-08, Extension of the Information Collection for the Consolidated
      Work Opportunity Tax Credit (WOTC) Program: Revised Reporting and
      Processing Forms;
    TEGL No. 11-08, Change 1, Extension Period Granted to all State Workforce
      Agencies (SWAs) and Employers for the Uninterrupted Use of All 2007 Work
      Opportunity Tax Credit (WOTC) Processing Forms;
    ETA Handbook No. 408, November 2002, Third Edition (the Handbook); and
    Addendum to the Handbook, August 2009, (Addendum, OMB No. 1205-0371).




 RESCISSIONS                                          EXPIRATION DATE
 None                                                 Continuing


3. Background. The WOTC program’s legislative authority was due to expire on August
   31, 2011. On December 17, 2010, President Obama signed into law the Tax Relief,
   Unemployment Insurance Reauthorization and Job Creation Act of 2010 (Pub. L. 111-
   312). This Act extended the program for an additional four-month period through
   December 31, 2011.

   On November 22, 2011, President Obama signed into law the VOW to Hire Heroes
   Act, which amends and expands the definition of veteran target groups for WOTC.
   The VOW to Hire Heroes Act provides legislative authority for tax credits for veteran
   target groups until December 31, 2012, but did not extend any of the other (non-
   veteran) WOTC target groups. The guidance provided in this TEGL applies only to
   the non-veteran target groups, for which legislative authority expired on December 31,
   2011. The Employment and Training Administration (ETA) will issue separate
   guidance regarding the amendments and provisions in the VOW to Hire Heroes Act.

   At this time, there is no indication if, or when, Congress may pass legislation extending
   authority for the non-veteran WOTC target groups beyond December 31, 2011.
   However, in the past when the tax credit program’s authority lapsed and Congress
   subsequently reauthorized the program, legislative provisions allowed for retroactive
   certification of eligibility for the period between the expiration date and the
   reauthorization date. However, to be eligible for the tax credit during that period,
   employers must have properly filed requests for certification, in a timely manner, and
   states must have received and logged them in for subsequent approval or denial. Final
   target group eligibility certification could only be issued after the tax credit
   reauthorizing legislative provisions were known.

   Even though Congress has, in the past, provided for retroactive certifications there is
   no guarantee that this will happen again or that employers’ new hires during this hiatus
   will be certified for the tax credit. In the event that the WOTC is extended with
   retroactive provisions, proper management of employers’ certification requests should
   help prevent large backlogs.

4. Administrative Program Guidance. During prior “hiatus periods,” ETA has
   instructed SWAs to accept applications (certification requests) in anticipation of a
   retroactive reauthorization. Therefore, ETA is instructing the SWAs to continue to
   accept applications for the expired target groups after December 31, 2011, but to hold
   off on processing the requests pending further legislative action and guidance from
   ETA.

   SWAs are instructed to adhere to the following procedures:

       Mandatory Procedures -

          SWAs must accept and fully process all timely filed WOTC certification
           requests for employers’ hires made prior to January 1, 2012.


          SWAs must accept, date stamp, log, and retain certification requests for
           employers’ new hires made after January 1, 2012, until informed otherwise by
           ETA. However, states may not issue eligibility certifications unless the
           program is once again reauthorized.

          SWAs and participating agencies (PAs) should continue to issue Conditional
           Certifications (ETA Form 9062). States should notify all PAs of this guidance
           upon receipt of this advisory.

       Voluntary Procedures:

          SWAs may conduct all steps necessary to process certification requests up to,
           but not including, issuance of the actual certification or denial.

5. Action Required. SWA administrators are advised to:

  a)   Increase employers’ awareness regarding the WOTC authorization lapse and the
       conditions for employers to file certification requests for their new hires during this
       period of time;

  b)   Notify employers that even though Congress has provided for retroactive eligibility
       certification in the past, certifications for an employer’s new hires during this
       hiatus are not guaranteed; and

  c)   Ensure all appropriate WOTC State Coordinators and related WOTC staff becomes
       familiar with the contents of this advisory, and take appropriate measures to ensure
       it is implemented in a timely manner.

6. Inquiries. Direct all questions to the appropriate Regional WOTC Coordinator, who
   are listed on the WOTC program Web site at: http://www.doleta.gov/wotc. A directory
   of WOTC State Coordinators is also available on this Web site.