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Congress recently enacted legislation that renewed the IRS’ ability to designate new empowerment zones through December 31, 2025. In response, the IRS issued guidance providing transition relief for employers by extending the 28-day deadline for employers to submit Work Opportunity Tax Credit (WOTC) applications to a designated local agency (DLA). The guidance applies to employees hired between January 1, 2018, and December 31, 2020. 

The IRS has since issued new guidance effective August 10, 2021, furthering the WOTC transition relief. This relief extends the 28-day deadline for employers to submit WOTC applications to the DLA for the following types of employees:

  • A member of the designated community resident targeted group, having a principal place of residence within an empowerment zone
  • A qualified summer youth employee, having a principal place of residence within an empowerment zone

The prolonged submission deadline pertains to applications for employees with a start date on or after January 1, 2021, and before October 9, 2021. For eligible employees, applications may be submitted to the DLA no later than November 8, 2021.

For more information on this guidance, reach out to your BKD Trusted Advisor™ or submit the Contact Us form below.

FORVIS Private Client services may include investment advisory services provided by FORVIS Wealth Advisors, LLC, an SEC-registered investment adviser, and/or accounting, tax, and related solutions provided by FORVIS, LLP. The information in this presentation should not be considered investment advice to you, nor an offer to buy or sell any securities or financial instruments. The services, or investment strategies, mentioned in this presentation may not be available to, or suitable, for you. Consult a financial advisor or tax professional before implementing any investment, tax, or other strategy mentioned herein. The information herein is believed to be accurate as of the time it is presented and it may become inaccurate or outdated with the passage of time. Past performance does not guarantee future performance. All investments may lose money.

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