Businesses in Washington State hiring qualified veterans are eligible for a new state tax credit in addition to the existing federal Work Opportunity Tax Credit (WOTC).
The credit applies to unemployed veterans of the armed forces hired on or after October 1, 2016, and prior to June 30, 2022. To qualify, the new hire must furnish a certificate of release or discharge from active duty (Form DD-214), along with proof of unemployment. Additionally, the new hire must be retained for at least two consecutive calendar quarters before the employer is eligible for the credit.
The Washington veteran hiring credit can be used to offset up to two types of tax:
It’s a one-time credit equal to 20% of a qualified employee’s wages earned during the first two calendar quarters of employment and up to $1,500 per employee. The credit may be claimed on monthly, quarterly, or annual returns. It isn’t refundable, but it may be carried forward until used, and it must be claimed no later than June 30, 2023. Note this is a first-come-first-serve credit with a statewide fiscal cap of $500,000 per year.
Moss Adams MaxCredits® is a web-based tool that allows employers to quickly and easily screen new hires for eligibility for state and federal hiring credits, including Washington’s new veteran credit and the WOTC. Learn more about how your business might benefit from this tax-savings opportunity.
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