Discover How the Work Opportunity Tax Credit Can Improve Cash Flow for Your Health Care Organization

See all this Month's Articles

Original Publish Date: December 5, 2017

Growing reimbursement pressure from Medicare and Medicaid coupled with expanding patient populations are requiring health care organizations to find new ways to increase revenue.

Federal tax credits and incentives are a good place to start. The Work Opportunity Tax Credit (WOTC) can provide a strong opportunity to increase cash flow without making largescale operational changes.

Work Opportunity Tax Credit

The WOTC is a federal income tax credit designed to encourage health care organizations and other businesses to hire individuals facing barriers to employment based on various criteria.

The maximum credit per new hire can range from $2,400 to $9,600, depending on which target group the individual qualifies under, including the following:

• Members of families that receive Supplemental Nutrition Assistance Program benefits, also known as food stamps
• Members of families that receive short- or long-term Temporary Assistance to Needy Families or Aid to Families with Dependent Children, also known as welfare
• Individuals who’ve been unemployed for at least 27 consecutive weeks and received unemployment compensation

The value of the tax credit is determined by:

• The target group under which the employee qualifies
• Number of hours worked
• Wages earned

Next Steps

Although health care organizations can benefit immensely from the WOTC, the time and energy to screen new hires and file the requisite paperwork can mean pursuing this credit often takes a backseat to more pressing operational matters. Luckily, technology can help streamline the process.

Automated technology and platforms, such as MaxCredits®—a web-based screening tool created by Moss Adams—can take the administrative burden off employers in submitting requisite paperwork by enabling health care organizations to seamlessly screen new hires and electronically sign any necessary forms. This ultimately helps health care organizations spend less time on administrative tasks and push more resources toward providing better care.

We're Here to Help

To learn more about your company’s eligibility for federal and state tax credits and incentives, visit our website or contact your Moss Adams professional.

MaryCaitlin Willcuts has practiced public accounting since 2010. She focuses on the WOTC and manages the Moss Adams MaxCredits® program, which speeds the screening process for federal and state tax credits. She can be reached at (503) 478-2309 or marycaitlin.willcuts@mossadams.com.

Rob O’Neill has practiced public accounting since 1998. He provides state and local tax advisory and compliance services to large multistate and multinational companies and their owners in a range of industries. He can be reached at (503) 478-2339 or rob.oneill@mossadams.com.