A: The Work Opportunity Tax Credit (WOTC), authorized by the Small
Business Job Protection Act of 1996 (P.L. 104-188), is a federal tax
credit that encourages employers to hire nine targeted groups of job
seekers by reducing employers’ federal income tax liability by as much
as $2,400 per qualified new worker; $750, if working 120 hours or
$1,200, if working 400 hours or more, per qualified summer youth.