Important: The Work Opportunity Tax Credit (WOTC) does not apply to employees who began work for an employer after December 31, 2025, and the IRS says Form 8850 is no longer in use. The steps below explain the former claim process for eligible hires who started on or before that date; they do not create eligibility for someone starting in 2026. See the IRS Form 8850 status page and IRS WOTC guidance.
Who could qualify for WOTC
For hires within the applicable period, an employer could seek WOTC for a new employee who belonged to a statutory targeted group and received certification from the state workforce agency. Being unemployed or facing an employment barrier did not, by itself, qualify someone.
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The IRS lists these targeted groups: qualified veterans; qualified IV-A/TANF recipients; qualified ex-felons; designated community residents; vocational rehabilitation referrals; qualified summer youth employees; qualified SNAP recipients; qualified SSI recipients; long-term family assistance recipients; and qualified long-term unemployment recipients. The agency’s certification—not the employer’s prescreening alone—establishes whether the employee qualifies. See the IRS instructions for Form 8850.
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How to request certification for a qualifying hire
The following steps describe the process for an employee who began work no later than December 31, 2025. Form 8850 was a certification request, not a tax return to send to the IRS.
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- Prescreen and complete Form 8850 by the job-offer date. The applicant provided information on or before the offer date, and the employer completed its portion no later than that date. Both the applicant and employer signed the form by the time it was submitted.
- Submit the request to the right state agency within 28 calendar days. Send Form 8850 to the state workforce agency for the state where the employee worked, generally no later than the 28th calendar day after the employee began work. Do not send it to the IRS.
- Include the supporting certification information that applies. IRS instructions describe ETA Form 9061 when the applicant did not have conditional certification, ETA Form 9062 when the applicant had conditional certification, and ETA Form 9175 for a qualified long-term unemployment recipient. Follow the state workforce agency’s instructions for submission details.
- Wait for the state’s decision. Filing Form 8850 does not certify the employee. The employer must receive the state’s certification before claiming the associated credit.
- Use the tax forms that apply to the employer. Taxable employers generally figured WOTC on Form 5884 and claimed it through Form 3800. A qualifying tax-exempt employer had a narrower route: Form 5884-C for a qualified veteran who began work before 2026, subject to the employer Social Security tax limit.
IRS resources: Form 8850 instructions, Form 5884, Form 3800, and Form 5884-C.
How much the credit could be
In the IRS’s described general case, WOTC was 40% of up to $6,000 in qualified first-year wages, for a maximum of $2,400 per qualifying employee. That is a ceiling under that wage calculation, not guaranteed savings for every certified hire. The available credit depended on the rules for the employee’s targeted group and the employer’s tax circumstances. See the IRS WOTC guidance.
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How employer type affected the claim
| Employer | Claim route | Limit to keep in mind |
|---|---|---|
| Taxable employer | Generally figure the credit on Form 5884 and claim it on Form 3800. | The credit is limited by the business’s income-tax liability. Unused amounts follow general business credit carryback and carryforward rules. |
| Qualifying tax-exempt employer hiring a qualified veteran who began work before 2026 | Form 5884-C. | The credit is limited to the employer’s share of Social Security tax on wages paid to qualifying employees. |
These routes are not interchangeable: the Form 5884-C option is specifically limited to qualifying tax-exempt employers and qualified veterans. Refer to the IRS Form 5884-C page and IRS Form 5884 page for the applicable forms and instructions.
What to do if you are reviewing an earlier hire
For a hire who started by December 31, 2025, check the offer-date prescreening and signatures, the date and destination of the state certification request, the supporting forms, and whether state certification was received before the tax credit was claimed. Then confirm that the claim used the form route appropriate to the employer. Because WOTC eligibility and timing depend on the individual hire and the employer’s tax situation, a tax professional can help review an earlier claim.
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