Tax Incentives

Update 07/09:

New York State Department of Labor: Employment-Based Tax Incentives )
Employment And Training Administration, United States Department Of Labor: 9 Ways to Earn Income Tax Credits for Your Company

Work Opportunity Tax Credit (WOTC)

All employees who have received VESID services with in the past two (2) years prior to the hire date, are eligible. Partial Credit of 35% becomes available after the employee has worked 120 hours. Full credit is given after 400 hours of employment. Summer youth who are residents of federally designated communities, must also work a minimum of 120 hours as well.

The tax credit is up to 40% of the employee’s first $6,000 in wages, to a maximum of $2,400.

Workers With Disabilities Employment Tax Credit (WETC)

All individuals who are eligible for VESID services and who work on a full-time basis for at least 180 days or 400 hours during the second (2nd) of employment. Employers are eligible for WETC independent of WOTC.

The tax credit is up to 35% of the employee’s first $6,000 in wages during 2nd year of employment up to a maximum of $2,100.

Long – Term Family Assistance (LTFA)

Employers who hire WOTC-qualified employees are eligible for one of three possible federal tax credits. Employees must have started work during the period from October 1, 1997 through December 31, 2007; must be certified eligible for WOTC; and must perform a minimum of 120 hours of service in order to generate a tax credit for their employers.

The three possible tax credits are:

The full rate – A credit equal to 40% of the first $6,000 in qualified first year wages, for a maximum credit of $2,400. The WOTC-certified employee must work a minimum of 400 hours for the employer.
The Reduced LTFA Rate –A credit equal to 25% of the first $10,000 of the first year or second year wages can generate an up to $2,500 of each of the two years. The WOTC-LTFA certified employee must perform at least 120 hours, but less than 400 hours, of service for the employer.
The summer youth rate – A credit of 40% of the first $3,000 in any 90-day period between May 1 and September 15 for a maximum credit of $750. The employee, certified as a Summer Youth, must work at least 120 hours for the employer.

Disabled Access Tax Credit

An employer with fewer than 30 employees OR no more than $1 million in gross receipts in the preceding year. Eligible expenses include the removal of barriers—architectural, communication, or transportation—including modification of equipment and the use of interpreters, taped text, or alternative format for communication.

The tax credit is up to 50% of “eligible access expenditures” that exceed $250 but do not exceed $10,250 for a taxable year. A business may take the credit each year that it makes an eligible barrier removal or service provision.

Architectural Transportation Barrier Removal Deduction

An employer who removes barriers to the workplace to make it more accessible and usable by individuals with disabilities.

The deduction is up to $15,000 per tax year.

Empire Zone (EZ) Wage Tax Credit

Employers whose business is located in an Empire Zone. The NYS Department of Labor and Empire State Development Commissioner must certify by a “Zone Coordinator” as well as the employer.

The job must be considered a “newly created job” (that is, the job must increase the number in the employer’s workforce over the average number of employees for the four preceding years).

The credit is $3,000 if the person hired is a targeted individual and the job pays at least 135% of the minimum wage. The credit is $1,500 if the person hired is not a targeted individual or the job pays less than 135% of the minimum wage. The credit can be applied for up to five years.