 Internal Revenue Service IRS Tax News for National Small Business Week. What? National Small B- You're not nationalizing my small business. I'm an independent entrepreneur for crying out loud. Dang, Socialist Commies always trying to control the means of production. It's especially dangerous for someone like me who produces words. They probably want to install some kind of jaw, tongue and vocal cord mechanical control mechanism to control my word production, which I can't imagine would be very comfortable. And it would most likely slow down my overall word production, which is sure to have a negative impact on the economy's GDP. For National Small Business Week, special tax credit can help employers hire workers. Key certification requirement applies. IR 2022-104, May 6, 2022, Washington with many businesses facing a tight job market. The Internal Revenue Service reminds employers to check out a valuable tax credit available for hiring long-term unemployment recipients and other groups of workers facing significant barriers to employment. So there's certain groups, of course, that might find it more difficult to get back into the job market, one of them being if you've been out of the job market for an extended period of time, which has kind of been incentivized with the unemployment and then, of course, this whole situation with COVID and whatnot, so you have a significant amount of people that might have a barrier to get back into the job market, might have some incentives in order to help them to get back in. So during the National Small Business Week, there's a link to that here. May 1-7, IRS is highlighting tax benefits and resources tied to the theme for this year's celebration, quote, building a better America through entrepreneurship, end quote. For any business now hiring, the Work Opportunity Tax Credit, there's a link to that here, may help. What is the WOTC? That's the Work Opportunity Tax Credit, by the way. This longstanding tax benefit encourages employers to hire workers certified as members of any of 10 targeted groups facing barriers to employment. With millions of Americans out of work at one time or another since the pandemic began, the IRS notes that one of these targeted groups is long-term unemployment recipients who have been unemployed for at least 27 consecutive weeks and received state or federal unemployment benefits during part or all of that time. So, obviously, this whole situation where basically people to some degree were kind of encouraged to not be in the workforce for an extended period of time in part with the incentive programs, that's part of the pros and cons of an incentive program, the pro, of course, trying to get the money to people that need the money, the con then being that it sometimes disincentivizes people to go back into the workforce, because if they go back into the workforce, they're going to lose the unemployment they may have otherwise been able to receive. But then, of course, that could extend the timeframe where there's nothing on the resume, and that can make it more difficult to jump back into the workforce after that point in time. So there might be in some incentives, there's a significant amount of people. We know the job market is still tight at this point in time, so there's a significant amount of people that you might actually get some benefits from to help them get back into the workforce. So the WOTC is available for wages paid to certain individuals who began work on over four December 31st, 2025. The other groups include certain veterans and recipients of various kinds of public assistance, among others. Specifically, the 10 groups are temporary assistance for needy families, TANF recipients, unemployed veterans, including disabled veterans, formerly incarcerated individuals, designated community residents living in empowerment zones or rural renewal counties, vocational rehabilitation referrals, summer youth employees living in empowerment zone, supplemental nutrition assistance program, SNAP, SNAP recipients, supplemental security income SSI recipients, long-term family assistance recipients and long-term unemployment recipients. Qualifying for the credit. To qualify for the credit, an employer must first request certification by submitting IRS form 8-8-5-0, pre-screening notice and certification request for the work opportunity credit. There's a link to that here. To their state workforce agency, the SWA, it must be submitted to the SWA within 28 days after the eligible worker begins work. Employers would not submit form 8-8-5-0 to the IRS. So don't go to the IRS. It goes to the SWA, the SWA. Helping new hires. Since many new hires may lack workplace experience, one way that employers can help these workers get off to a good start is to make sure they have the right amount of tax taken out of their pay. A great way to do that is to encourage them to use the tax withholding estimator. So as you pick it up, new employees as you turn over any employees in the workforce, but possibly especially people that have been out of the workforce for a while, the tax withholdings can be more complicated these days, possibly than prior years due to all the fluctuations in people's work, people being out of work can confuse that situation as well, multiple people working and then just changes to the tax code. So you pretty much need a software to help you to calculate the W-4 withholdings and whatnot. So you got this tool here you can take a look at. A free online tool. It's available on irs.gov, irs.gov, B, B for victory over tax questions. By filing in a few key pieces of information, an employee can use the tax withholding estimator to estimate the right amount of tax to have taken out of their pay. Among other things, this online tool can help them see how withholding affects their take home pay, expected refund or tax due. The tax withholding estimator also will also help them correctly fill out form W-4 Employees Withholding Certificate, which is of course what we need as the employer to get the proper withholdings. The employee gives this form to their employer, not the IRS. Once an employee has been on the payroll for a while, they can also use this tool to update their withholding to reflect impertinent life changes. So as life changes happen, you can update your withholding estimator. You should do that first. You should look at the tax consequences of every choice you make and then make it in accordance to the best tax situation. Now I'm just kidding. But use the tax withholding estimator. So like getting married, getting divorced, having children. Obviously you calculate the numbers and then you make the decision. Just kidding. But you should keep the numbers in mind as things happen. So the tax withholding estimator can also be a useful tool for existing employees by helping them avoid a year-end tax surprise. So obviously you don't want to owe money at the end of the year and or penalties and interest. So for more information, you can visit irs.gov forward slash withholding. There's a link to that here. Claiming the credit. We want to claim the credit. Eligible businesses then claim the WOTC on their federal income tax return. That's how you get it done. It is generally based on wages paid to eligible employers during the first year of employment. This is a one-time credit for each new hire and an employer cannot claim the WOTC for employees who are rehired. So you can't like fire them and rehire them every month or something like that and try to rack up your credit. That would be trying to not be honest with the system there. That's not right. You can't do that. The credit is first figured on form 5884, work opportunity credit. There's a link to that here. And then claimed on form 3800, general business credit. There's a link to that here. Though the credit is not available to tax exempt organizations for most groups of new hires, a special rule allows them to claim the WOTC. So for hiring qualified veterans, these organizations claim the credit against payroll taxes on form 5884C, work opportunity credit for qualified tax exempt organizations hired qualified veterans. There's a link to that. They're a very descriptive title to that form, clearly. A lot of detail in that title. Additionally, see the LB&I and the SB slash SE joint directive on the WOTC. There's a link to that here. It's on the IRS. It issued it to help certain employers affected by extended delays in the WOTC certification process. So if you've got questions about this stuff and you want to look into more research and you want to dig into it, there's links that every time I said a link, that means there's a link here to it. And there'll be a link to this in the description.