Can You Claim the WOTC for 2026 Hires? Is WOTC Extended?

Not under current law. The Work Opportunity Tax Credit only covers people who began work on or before December 31, 2025, and as of October 30, 2026, Congress had not passed an extension. It has been extended retroactively after past lapses, so it could come back, but don't plan on it until a law passes.

40%For eligible hires, the credit is generally 40% of up to $6,000 of first-year wages for an employee who works at least 400 hours, so the usual maximum is $2,400 per employee.
$6,000For eligible hires, the credit is generally 40% of up to $6,000 of first-year wages for an employee who works at least 400 hours, so the usual maximum is $2,400 per employee.
$2,400For eligible hires, the credit is generally 40% of up to $6,000 of first-year wages for an employee who works at least 400 hours, so the usual maximum is $2,400 per employee.
25%A 25% rate applies to employees who work at least 120 but fewer than 400 hours.

Not under current law. The Work Opportunity Tax Credit (WOTC) is available only for wages paid to people in a targeted group who began work on or before December 31, 2025. Federal law says wages don't count for anyone who begins work for the employer after that date, and as of October 30, 2026, Congress had not passed an extension. The credit has lapsed before and been brought back retroactively, so it could return, but you shouldn't plan on it until a law is passed.

Last checked: October 30, 2026. This page explains the rules only. It is general information, not tax, legal, or financial advice, and it doesn't estimate what any business can claim.

The short version

Status	lapsed for new hires. The IRS says the WOTC is available for wages paid to certain individuals who begin work on or before December 31, 2025.
2026 hires	not eligible unless Congress extends the credit and makes the extension cover them.
Earlier hires	credit already earned for eligible people who began work by December 31, 2025, can still be used, and unused credit can generally be carried back 1 year and forward up to 20 years.
Past lapses	the Congressional Research Service notes the WOTC has lapsed and been extended retroactively before, for example by the Tax Increase Prevention Act of 2014.
Bills	bills to extend the credit have been introduced in Congress, but none had become law as of October 30, 2026.
Paperwork	the IRS says Form 8850, the pre-screening form, is no longer in use.

How much the credit was worth

For eligible hires, the credit is generally 40% of up to $6,000 of first-year wages for an employee who works at least 400 hours, so the usual maximum is $2,400 per employee. A 25% rate applies to employees who work at least 120 but fewer than 400 hours. For certain qualified veterans, up to $24,000 in wages can count. Employers can't claim it for rehired employees.

What to do if you're hiring in 2026

Don't count on the credit. Leave it out of your hiring budget until a law is actually passed.
Know the form changed. On March 19, 2026, the IRS posted that Form 8850, the pre-screening form, is no longer in use because the credit doesn't apply to employees who begin work after December 31, 2025.
Keep good records. Note each new hire's start date, hours and wages, and whether they may fit a targeted group, so you can act quickly if the rules change.
Ask your state workforce agency. The CRS reports that during a lapse, states can review and prepare certification requests but may not issue certifications. Your state agency can tell you what it is accepting now.
Watch for IRS guidance. After a past retroactive extension, the IRS gave employers extra time to submit certification requests for people hired during the lapse (IRS Notice 2016-22). If Congress acts again, look for similar guidance before you file anything.

Who qualifies

Who qualified

Employers of any size could claim the WOTC for people certified as members of a targeted group, including:
Qualified veterans (several groups, including unemployed veterans and veterans with a service-connected disability).
Recipients of Temporary Assistance for Needy Families (TANF) and long-term family assistance recipients.
People in families receiving SNAP benefits who meet the age and timing rules.
Qualified ex-felons hired within a year of conviction or release.
Designated community residents living in an Empowerment Zone or Rural Renewal County.
Vocational rehabilitation referrals and Supplemental Security Income (SSI) recipients.
Qualified summer youth employees living in an Empowerment Zone.
Qualified long-term unemployment recipients (unemployed at least 27 consecutive weeks).
Tax-exempt employers could claim it only for qualified veterans, and only against payroll taxes.

How to get it

How to get started (for eligible pre-2026 hires)

Confirm the employee began work on or before December 31, 2025, that Form 8850 was filed on time (by the job offer for pre-screening, and with your state workforce agency within 28 days of the start date), and that you have the agency's certification.
Figure the credit on Form 5884 (tax-exempt employers use Form 5884-C).
Claim it as a general business credit on Form 3800 with your business income tax return.
Carry any unused credit back 1 year or forward up to 20 years, following the Form 3800 instructions.

Programs that may match

Look beyond the WOTC

The employer credit for paid family and medical leave was made permanent and expanded, according to the IRS. It can reward employers that offer paid leave to employees with at least six months of service.Many states have their own job creation credits. See our guides to the Oklahoma Quality Jobs Program and South Carolina business incentives.Young companies doing research can use the R&D credit against payroll taxes. See our guide to the R&D tax credit payroll election.Not sure what applies to you? See how to find tax credits and incentives your business qualifies for, or take FundPlenty's free match at fundplenty.com.

FAQ

Is the Work Opportunity Tax Credit extended for 2026?

Not as of October 30, 2026. The credit covers only people who began work on or before December 31, 2025. Bills to extend it have been introduced, but none had become law.

Can I claim the WOTC for someone I hired in January 2026?

Not under current law. Federal law excludes wages paid to anyone who begins work after December 31, 2025. That would change only if Congress extends the credit to cover 2026 hires.

Should I still file Form 8850 for 2026 hires?

The IRS says Form 8850 is no longer in use, because the credit doesn't apply to employees who begin work after December 31, 2025. Keep records on new hires and check with your state workforce agency. If Congress extends the credit, watch for IRS guidance on how and when to request certification.

How much is the WOTC worth per employee?

Generally 40% of up to $6,000 of first-year wages, or up to $2,400, for an employee who works at least 400 hours. Up to $24,000 of wages can count for certain qualified veterans.

Can I still use WOTC credits from 2025 hires?

Yes. Credit earned for eligible employees who began work by December 31, 2025, can still be used, and unused credit can generally be carried back 1 year and forward up to 20 years.