Non-Profit Eligibility for WOTC: What You Need to Know

Non-profit organizations can qualify for the Work Opportunity Tax Credit (WOTC)—but only when hiring Qualified Veterans. This guide explains eligibility, filing steps, and how to streamline the process for maximum tax benefits.

WOTC Eligibility for Non-Profits: Key Points

• Eligible Category: Only veterans meeting IRS-defined criteria qualify.
• Payroll Tax Credit: Non-profits apply WOTC against the employer’s share of Social Security taxes.
• Compliance Required: Follow all IRS and DOL filing deadlines and documentation requirements.

What Is the Work Opportunity Tax Credit (WOTC)?

The Work Opportunity Tax Credit (WOTC) is a federal incentive encouraging employers to hire individuals from targeted groups who face employment barriers.

Purpose: To promote workforce diversity and reduce unemployment.
Administration: Jointly managed by the IRS and Department of Labor (DOL).

Targeted Groups Include:

• Veterans (including those with service-connected disabilities)
• SNAP recipients
• Ex-felons
• Long-term unemployed individuals

For non-profits, only Qualified Veterans are eligible for WOTC claims.

Who Qualifies as a “Qualified Veteran”?

Non-profits under IRC Section 501© can claim WOTC for veterans who meet one or more of these conditions:

• SNAP Veterans: Received SNAP benefits for at least 3 months in the first year of employment.
• Unemployed Veterans: Unemployed for 4+ weeks (less than 6 months) or 6+ months before hire.
• Disabled Veterans: Have a service-connected disability and were hired within one year of discharge or after 6+ months of unemployment.

How Non-Profits Claim the WOTC (Step-by-Step)

1. Pre-Screen Applicants:
   Complete IRS Form 8850 on or before the job offer date.
2. Fill Out ETA Form 9061:
   Include veteran documentation (e.g., DD-214).
3. Submit to State Workforce Agency:
   File both forms within 28 days of the employee’s start date.
4. Wait for Certification:
   The agency verifies eligibility (typically 10–12 months).
5. File IRS Form 5884-C:
   Claim the credit against payroll (Social Security) taxes.

Tip: Maintain complete documentation and filing records to ensure compliance.

Maximize WOTC Benefits with Rockerbox

Rockerbox’s automated WOTC technology simplifies submissions, ensures timely certification, and can improve non-profit cash flow by up to 40%.
This automation reduces administrative workload, allowing your team to focus on your mission while maximizing available tax incentives.

Benefits of WOTC for Non-Profits

• Payroll Tax Savings: Reduce your Social Security tax liability.
• Support Veterans: Provide meaningful jobs for those who served.
• Improved Cash Flow: Reinvest savings into programs and operations.
• Automation Ready: Technology-driven filing ensures accuracy and efficiency.

Frequently Asked Questions

Q: Can non-profits qualify for WOTC?
Yes, but only for hiring Qualified Veterans as defined by IRS guidelines.

Q: Can non-profits claim both WOTC and ERC?
Yes, but you cannot use the same wages for both credits. Separate wage calculations are required.

Q: What forms are required to claim WOTC?
You’ll need IRS Form 8850, ETA Form 9061, and IRS Form 5884-C for non-profits.

Q: How long does certification take?
State Workforce Agencies typically process certifications in 10–12 months.

Q: How can Rockerbox help?
Rockerbox automates eligibility screening, filing, and tracking—helping non-profits maximize credits with minimal effort.

Conclusion

Non-profits can unlock valuable tax savings through the WOTC program by hiring Qualified Veterans. Following IRS guidelines and leveraging automated solutions like Rockerbox ensures compliance, efficiency, and improved financial outcomes—allowing your organization to focus on making a greater impact.

Contact Rockerbox to learn how your non-profit can start claiming WOTC today.