Important: The IRS says the Work Opportunity Tax Credit (WOTC) does not apply to an employee who began work after December 31, 2025, and Form 8850 is no longer in use. The steps below are for employers reviewing claims for hires who started on or before that date—not for employees starting in 2026. See the IRS Form 8850 status page.
Who could qualify for WOTC?
For a hire who began work by December 31, 2025, WOTC could be available if the employee was certified as belonging to one of the statutory targeted groups. The IRS lists:
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- 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
- Qualified long-term unemployment recipients
These are defined categories, not a general rule that anyone facing an employment barrier qualifies. The state workforce agency had to certify the employee’s status.
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- Prescreen and complete Form 8850 by the job-offer date. Under the former process, the applicant supplied information on or before the date of the job offer, and the employer completed the rest by that date. Both signed the form by the time it was submitted.
- Submit the certification request to the state workforce agency. Send Form 8850 to the agency for the state where the employee worked—not to the IRS. The general deadline was the 28th calendar day after the employee began work.
- Include any required supporting information. IRS instructions identify ETA Form 9061 when there was no conditional certification, ETA Form 9062 when the applicant had a conditional certification, and ETA Form 9175 for a qualified long-term unemployment recipient. Follow the relevant state workforce agency’s submission instructions.
- Wait for the agency’s decision. Form 8850 requested certification; filing it did not itself certify the employee. The employer needed to receive certification before claiming the related credit.
- Use the tax forms for the employer type. Taxable employers generally figured the credit on Form 5884 and claimed it on Form 3800. Qualifying tax-exempt employers had a narrower route: Form 5884-C for qualified veterans who began work before 2026.
The deadlines and forms above describe the former process for eligible start dates. The IRS says Form 8850 is no longer in use.
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Which tax forms applied to each employer type?
| Employer type | Claim forms | Limit |
|---|---|---|
| Taxable employer | Form 5884 to figure the credit; Form 3800 to claim it | Limited by the business’s income-tax liability. Unused amounts follow general business credit carryback and carryforward rules. |
| Qualified tax-exempt employer hiring a qualified veteran who began work before 2026 | Form 5884-C | Limited to the employer’s share of Social Security tax on wages paid to qualifying employees. |
How much could the credit be?
In the IRS’s stated general calculation, the credit 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 the described wage calculation, not a guaranteed credit: the applicable targeted-group rules and the employer’s tax situation affect the amount available. The IRS source page does not specify a publication year for this figure.
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