Federal tax benefits may be available to employers that hire veterans under the Work Opportunity Tax Credit (WOTC). Employers can receive up to a $9,600 tax credit by hiring a veteran. Tax credits currently are available for hires in the following categories of veterans:
WOTC Target Group
Maximum Tax Credit
Disabled veterans with a service-connected disability who have been unemployed for at least 6 months
Veterans who have been unemployed for at least 6 months
Disabled veterans with a service-connected disability
Veterans receiving Supplemental Nutrition Assistance Program (SNAP) benefits
Veterans who have been unemployed for at least 4 weeks
Employers also can receive tax credits by hiring individuals from one of several non-veteran target groups. For more information, see Work Opportunity Tax Credit.
Employers hiring multiple WOTC-qualified employees can see a significant reduction in their federal income taxes. These benefits are explained and claimed on IRS Form 5884.
Another program that might benefit employers is the U.S. Department of Defense Mentor-Protégé Program, which allows certain government contractors to receive reimbursements for training or incidental costs associated with training physically-challenged veterans.