S. 492: Improve and Enhance the Work Opportunity Tax Credit Act
Sponsor
Bill Cassidy
Republican · LA
Bill Progress
Latest Action · Feb 10, 2025
Read twice and Referred to Finance. for review
Why it matters
For employers, this is a straightforward incentive upgrade: a larger federal tax credit for hiring targeted workers, with the bill explicitly aimed at encouraging longer-service employment rather than just quick churn. The clearest winners would be low-income job seekers, especially SNAP recipients over 39 who are currently excluded under existing law; the tradeoff is lower federal tax revenue, and critics may question whether businesses will actually create new opportunities or simply collect a bigger credit for hires they would have made anyway.
S. 492 Common Questions
How much is the Work Opportunity Tax Credit under S.492?
Under the Improve and Enhance the Work Opportunity Tax Credit Act (Section 2(a)), employers could claim 50% of qualified first-year wages up to $6,000, plus 50% of wages from $6,000 to $12,000 for workers with at least 400 hours of service.
Can employers get a bigger WOTC if an employee works at least 400 hours?
Yes. Under the Improve and Enhance the Work Opportunity Tax Credit Act (Section 2(a)), employers could claim 50% of qualified first-year wages between $6,000 and $12,000 for workers who complete at least 400 hours of service.
How much is the veteran Work Opportunity Tax Credit under S.492?
According to S.492 Section 2(b), veteran wage limits rise to $12,000/$24,000, $14,000/$28,000, or $24,000/$48,000 depending on the veteran category under IRC 51(d)(3).
Can employers claim the Work Opportunity Tax Credit for SNAP recipients over age 39?
Yes. Under the Improve and Enhance the Work Opportunity Tax Credit Act (Section 3(a)), the bill removes the SNAP recipient age ceiling of "but not age 40," so eligible hires over 39 could qualify.
What are the WOTC rates for long-term family assistance recipients in S.492?
Under the Improve and Enhance the Work Opportunity Tax Credit Act (Section 2(e)), employers could claim 40% of first-year wages up to $10,000 and 50% of second-year wages up to $10,000.
How much is the summer youth employee tax credit under S.492?
According to S.492 Section 2(d), the credit for summer youth employees stays at 40% of qualified first-year wages, capped at $3,000 per year.
When would the S.492 Work Opportunity Tax Credit changes take effect?
Under the Improve and Enhance the Work Opportunity Tax Credit Act (Section 2(f)), the WOTC changes apply to individuals beginning work for the employer after December 31, 2024.
Does S.492 reduce the summer youth tax credit for some workers?
Yes. Under the Improve and Enhance the Work Opportunity Tax Credit Act (Section 2(d)), the rate drops to 25% for individuals described in Section 51(i)(3)(A), and no wages count for those in Section 51(i)(3)(B).
Does S.492 increase the WOTC percentage for workers who do not meet minimum employment periods?
Yes. According to S.492 Section 2(c), the bill raises the credit percentage from 40% to 50% for individuals covered by Section 51(i)(3)(A) who do not meet the minimum employment periods.
When would the new SNAP age rule for WOTC start under S.492?
According to S.492 Section 3(b), the SNAP age-limit removal would apply to individuals beginning work for the employer after December 31, 2024.
Based on S. 492 bill text
S492 Legislative Journey
Committee Action
Feb 10, 2025
Read twice and referred to the Committee on Finance.
About the Sponsor
Bill Cassidy
Republican, LA · 17 years in Congress
Committees: Health, Education, Labor, and Pensions, Veterans' Affairs, Finance
View full profile →
Cosponsors (1)
This bill has 1 cosponsor: 1 Democrat. Cosponsors represent 1 state: New Hampshire.
Committee Sponsors
14 Republicans across this committee haven't cosponsored yet. Mobilize their constituents
What laws does S. 492 change?
1 changes
Sections Amended
Section 51(e) of such Code
striking ``Credit for Second-year Wages'' and inserting ``Special Rules for Determining Credit''
S. 492 Quick Facts
- Committee
- Finance
- Chamber
- Senate
- Policy
- Taxation
- Introduced
- Feb 10, 2025
Read twice and Referred to Finance. for review
Feb 10, 2025
S. 492 Bill Text
“To amend the Internal Revenue Code of 1986 to improve and enhance the work opportunity tax credit, to encourage longer-service employment, and to modernize the credit to make it more effective as a hiring incentive for targeted workers, and for other purposes.”
Source: U.S. Government Publishing Office
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