Tax Intelligence: Compliance Pays When Bundled with WOTC
Work Opportunity Tax Credit (WOTC) provides a federal tax incentive for each eligible hire. Employers are challenged to meet screening and compliance regulations and deadlines when assessing new hire eligibility, potentially leaving millions of dollars of tax credit savings on the table. Screening percentages and compliance are key performance indicators for the WOTC program. Employers are thus challenged to find ways to motivate and monitor program performance. However, unlike other compliance workflows (i.e. I-9, W-2) involved in applicant tracking and onboarding, WOTC screening is not compulsory. To take advantage of this credit hiring managers must ensure that new hires are screened for WOTC on or before the day of the job offer.
By bundling tax credit capture workflows, with required compliance processes (i.e. Form I-9), employers on average realized a 12x ROI. Employers with a primarily high turnover and entry level workforce saw an average of an 80% increase in WOTC compliance. Equifax Compliance Center provides a strategic workflow designed to maximize WOTC screenings to increase tax credits and deliver bottom line value by:
- Delivering 100% WOTC Form 8850 compliance through electronic completion and eSignature
- Reducing risk by ensuring Form I-9 compliance
- Paying for your compliance management solution through increased tax credits
There are three main areas that influence the percentage of screening and document completion in the WOTC tax credit screening process. By bundling compliance processes with WOTC in Compliance Center, Equifax addresses all three areas and thus ensures maximum tax credits.
- Ensuring new hires answer the screening questions: The Compliance Center solution is uniquely designed to ensure that all new hires review the WOTC questionnaire. Equifax has found that applicants almost always complete the survey as they are already in the mode of answering questions and completing documents.
- 8850 electronic signature: This greatly improves form compliance as often these forms are misplaced or not completed.
- Electronic consent (general release): This new hire consent allows Equifax to pull needed documentation to process the credit and substantiate eligibility. This removes the burden from the hiring manager and increases credit realization.
Thus, by strategically including compliance workflows in the same packet and requiring that applicants advance through the WOTC Form 8850 before completing Form I-9 for example, Equifax is able to tie the penalties of Form I-9 to the benefit of WOTC.
Utilizing the Equifaxs Compliance Center portal to couple non-compulsory WOTC screening, to other, required hiring processes, HR departments can more easily and effectively drive screening compliance, and therefore, realized tax credit value. By offering applicants and employees a seamless interface to move between WOTC screening and I-9 completion, employers will experience significant increases in screening compliance, and importantly, significantly less screening “drop-off”, or rather, individuals who decline to screen, or do not complete screenings all the way through. All this adds up to better risk management tied to real dollar capture.
Equifax offers the industry leading tax credit capture platform and management suite. Coupled with our extensive Compliance Center and onboarding system, HR departments can drive WOTC credit value while mitigating risk and ensuring compliance. If your company is interested in receiving more information on how you can benefit by coupling tax credit screening to compliance management, please contact Pete Krieshok of Equifax Workforce Solutions at 314-214-7325 or by email at firstname.lastname@example.org.
Click here for a PDF version of this bulletin.