Provider: Community Development Department

Categories: Business Assistance: Financial Assistance

Description
Advance Earned Income Tax Credit (AEITC): Qualified families with at least one qualifying child living with them may receive up to $130 a month ($1,563 per year), as extra money in their paycheck. All that is necessary is for an employee to file an IRS FORM W-5 with their employer showing eligibility. Advance EITC costs the employer nothing, since the employer withholds less taxes from the worker's paycheck and reduces the amount forwarded in payroll withholding taxes to the IRS. Most payroll firms can handle this process automatically, however, only a few employers are providing this benefit to their employees. Work Opportunity Tax Credit The Work Opportunity Tax Credit (WOTC) provides businesses with an incentive to hire individuals from targeted groups having high unemployment rates or special employment needs. Business owners may claim the credit if they pay first year wages to individuals from a targeted employee group. The WOTC has been extended to individuals who begin work before January 1, 2003. WOTC reduces a business owner's tax liability up to $2,400 per new hire, except for 16-17 year-old summer youth hired from the Empowerment Zone/Enterprise Community for which the maximum credit is $1,200.

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