EMPLOYMENT AND TRAINING ADMINISTRATION
ADVISORY SYSTEM
U.S. DEPARTMENT OF LABOR
Washington, D. C. 20210

CLASSIFICATION

WOTC/WtWTC

CORRESPONDENCE SYMBOL

OWS

ISSUE DATE

January 7, 2002

RESCISSIONS

 

EXPIRATION DATE

September 30, 2002

DIRECTIVE

:

TRAINING AND EMPLOYMENT GUIDANCE LETTER NO. 09-01

 

TO

:

ALL STATE WORKFORCE LIAISONS
ALL STATE WORKFORCE AGENCIES
ALL STATE WORKER ADJUSTMENT LIAISONS
ALL ONE-STOP CENTER SYSTEM LEADS

 

FROM

:

EMILY STOVER DeROCCO
Assistant Secretary

 

SUBJECT

:

Work Opportunity Tax Credit (WOTC) and Welfare-to-Work Tax Credit Program (WtWTC) Procedural Guidance During Authorization Lapse

 

  1. Purpose. To provide procedural guidance to States for processing requests for certification under the Work Opportunity and Welfare-to-Work Tax Credit program after the December 31, 2001 expiration. This guidance covers the period January 1 through September 30, 2002, or until further notice.

  2. References. The Ticket to Work and Work Incentives Improvement Act of 1999, (P.L. 106-170); Internal Revenue Code of 1986, Sections 51 and 51A, as amended; and ETA Handbook No. 408, Second Edition, November 1998.

  3. Background. The WOTC and WtWTC program legislative authority expired on December 31, 2001. WOTC and WtWTC program reauthorization legislation was contained in the Economic Stimulus package on which Congress failed to complete action in December. There is no indication at this time if or when the Congress may pass legislation that reauthorizes the program or whether the President will sign such legislation.

    In the past when the tax credit program lapsed and the Congress subsequently reauthorized the program, legislative provisions allowed for retroactive certification of eligibility for the period between the expiration date and the reauthorization date. However, to be eligible for the tax credit during that period, employers must have properly filed requests for certification in a timely manner and states must have received and logged them in for subsequent approval or denial. Final job seeker eligibility certification could only be made after the tax credit reauthorization legislative provisions were known.

    In the event that the tax credit program is reauthorized with such retroactive provisions, proper management of employer certification requests may help prevent large backlogs.

  4. Action Required. 

    State Workforce Agency (SWA) Administrators are requested to inform employers regarding the WOTC and WtW tax credit authorization lapse and the conditions for employer certification requests of new hires during this period. Employers should be notified, however, that although Congress has provided for retroactive eligibility certification in the past, certifications for an employer's new hires during this hiatus are not guaranteed.

    SWAs are also requested to adhere to the following:

  5. Inquiries. Direct all questions to the appropriate Regional WOTC/WtWTC Coordinator.