Welcome to the AllianceHCM WOTC service
Frequently Asked Questions
What is the Work Opportunity Tax Credit (WOTC) program?
The Work Opportunity Tax Credit (WOTC) is a federal tax credit program available to employers as an incentive to hire individuals from certain targeted groups. People in these groups have usually faced significant barriers to employment such as veterans, the long-term unemployed, and food stamp recipients.
How does the process work?
As you hire new employees, AllianceHCM will determine their initial eligibility through a questionnaire and submit an application to the appropriate state workforce agency. The state will review the application and decide to certify or deny the claim. AllianceHCM will update those results into AllPay and uses the payroll data to calculate the exact credit amount per new hire.
AllianceHCM tip: Your company can maximize potential tax credits by using our Onboarding service. Please contact us to learn more at wotc@alliancehcm.com.
What is a Power of Attorney (POA) and why does AllianceHCM need one?
The POA is the legal document that allows us to act on your behalf filing WOTC applications and following up on the status of pending claims. Each state requires the consultant to have the POA in place before we submit WOTC applications, delays completing and returning this document can cost you tax credit! The new POA approved by the IRS in 2023 is good for 5 years and is required for each unique company FEIN.
This sounds complex. How do I claim the credit?
One of the most complex aspects of the program is the credit calculation, but don’t worry, we make it easy! AllianceHCM will give you a finalized tax credit package each spring that contains all the completed forms to claim the credit on the federal tax return. Please ensure you provide this documentation to your tax preparer once received. The credit is not a check; it is included in your tax return and offsets your company’s tax liability.
How much will I receive? How much will I be charged?
How much your company will receive is based on the qualified employees’ wages earned and hours worked during the first year of employment, ranging from $2,400 up to $9,600 per employee, depending on the targeted group. Our fee is only 10% of the tax credits delivered and is billed annually in October. Reach out to your WOTC team for more information at wotc@alliancehcm.com.
Where can I monitor the status of my credits?
In AllPay, hover to open the Onboard menu and then select Tax Credits.
Where can I find my WOTC tax package?
In AllPay, navigate to the Configuration menu on the left menu, then hover to open Company Setup from your top navigation and select Tax Documents. There you will find the document entitled Tax Credit Package (5884).
