WOTC May Expire Soon: What Retailers Need to Do Before December 31

If you've been using the Work Opportunity Tax Credit to reduce your hiring costs, there's something you need to know: WOTC is set to expire at the end of this year unless Congress acts.

That means tax credits worth $2,400 to $9,600 per eligible new hire could disappear—right when independent retailers are already dealing with staffing shortages, rising costs, and tariff uncertainty.

For nearly 30 years, WOTC has helped retailers hire veterans, individuals with disabilities, SNAP recipients, long-term unemployed workers, and others who deserve a chance to get back into the workforce. Losing this program would hurt both store owners and the people who rely on it to build careers.

Here's what's at stake, what to expect if Congress doesn't act, and what you should do before December 31.

Why WOTC Matters for Independent Store Owners

WOTC isn't just another tax program—it's one of the few tools retailers have that directly offsets the real costs of hiring and training.

When you hire someone, you're investing in them long before they're fully productive. You're paying wages during training, pulling experienced staff away from customers, and taking a risk on someone who may or may not work out.

WOTC helps retailers absorb those costs by offering credits when they hire individuals who face barriers to employment.

One liquor store owner shared this with me:

"I hired a veteran who had been out of work for a while. The WOTC credit covered most of my training costs, which made me more willing to invest time in getting him up to speed. He's now one of my best employees. Without WOTC, I probably would have gone with someone who had more recent retail experience."

This is exactly what WOTC does—it gives small retailers the financial breathing room to hire capable people who might otherwise get overlooked.

WOTC Helps People Build Careers, Not Just Find Jobs

According to the National Retail Federation, many retail employees who enter the workforce through WOTC opportunities eventually grow into supervisory or management roles. These employees aren't just filling short-term positions—they're building long-term financial stability.

Retailers see this every day. A SNAP recipient hired as a seasonal cashier becomes the person who can run the store alone. A second-chance hire becomes the most reliable employee on staff and starts training others. A veteran brings discipline, leadership, and structure that lift the entire team.

These aren't charity hires—they're strong employees who benefited from a program that reduced the financial risk of giving them a chance.

If WOTC expires, both retailers and job seekers lose that opportunity.

The Worst Possible Timing

Retail is the largest private-sector employer in America, supporting 55 million jobs. And yet, finding and keeping reliable workers remains one of the toughest challenges for independent store owners.

You've felt this firsthand. Job postings with no applicants. Interviews where the candidate never shows up. New hires who leave after a few shifts. Shrinking margins and rising costs.

And now, with tariff uncertainty increasing costs and supply chain pressures affecting inventory, losing WOTC would deliver another blow.

As the NRF put it: "At a time when retailers are already navigating uncertainty from new tariffs and global supply chain pressures, losing WOTC would create another major challenge."

A medical supply store owner told me: "Between tariffs, difficulty finding good employees, and customers being more price-sensitive, I'm already juggling a lot. Losing WOTC would be one more hit to my ability to hire and train the staff I need."

What Happens If WOTC Expires

If Congress lets WOTC lapse at year-end, here's what it means for your store:

No more hiring credits: The credits worth $2,400–$9,600 per eligible new hire disappear.

Less flexibility in hiring: Taking a chance on someone without recent experience—or someone who needs more training—becomes financially riskier.

Higher overall hiring costs: Training, onboarding, turnover, and lost productivity stay the same. You just lose the program that helped soften the blow.

Fewer opportunities for workers: Communities lose a pathway to employment for people who want to work but face barriers getting hired.

WOTC Should Be Permanent—Not a Political Question Every Year

WOTC has existed since 1996, but Congress continues to extend it temporarily instead of making it permanent. That uncertainty makes it harder for small retailers to plan hiring and staffing.

The NRF and many business groups are urging Congress to make WOTC permanent. It's rare for a program to be bipartisan, widely used, good for businesses, good for workers, and proven to reduce reliance on government assistance.

But Congress won't act unless they hear from employers—especially small, independent retailers who rely on the credit.

What You Should Do Before December 31

Even if you're unsure what Congress will do, here's what you should do right now while WOTC is still available:

Make sure you're screening every new hire: If you're not screening for WOTC eligibility today, you're leaving money on the table.

Review recent hires from earlier this year: You may have eligible employees you didn't screen. Depending on the timing, you may still be able to claim credits.

Contact your representatives: It takes five minutes using the NRF Action Center. Your message matters far more than people realize.

Don't assume Congress will extend WOTC automatically: WOTC has lapsed before—and may lapse again unless businesses speak up.

Set up automated WOTC screening: Automated tools ensure you never miss a credit, whether the program continues or not.

How Heartland Payroll+ Helps You Capture Every Available Credit

Heartland Payroll+ includes automatic WOTC screening as part of the hiring process. It identifies eligible candidates early, handles the paperwork, and ensures you claim every credit you're entitled to.

If WOTC is extended, you're already set up to keep capturing credits. If WOTC expires, you won't miss any credits for hires made before December 31. Either way, you win.

• Act this week, not next month: December gets crazy fast. If you want to claim WOTC credits for any 2025 hires, start the process now while you still have time.
• Don't skip the NRF Action Center: Five minutes sending a message to your representatives could help save a program that puts thousands back in your pocket every year.
• Check your recent hires: Pull your hiring records from the past few months. You might have hired WOTC-eligible employees without knowing it—and there may still be time to file.
• Automate it moving forward: Whether WOTC continues or not, having systems that automatically screen for tax credits means you never leave money on the table.
• Spread the word: Talk to other local retailers about WOTC. The more small business owners who contact Congress, the better chance this program gets extended or made permanent.

The Bottom Line

WOTC has helped independent retailers offset hiring costs and provide opportunities for nearly 30 years. Losing it would make hiring harder, raise operational costs, and remove a valuable pathway to employment for people who deserve a chance.

Congress needs to hear from retailers like you that WOTC matters—and that it shouldn't quietly disappear.

And no matter what happens in Washington, make sure you're capturing every credit available right now while the program still exists.

Book an appointment to set up Heartland Payroll+ with automatic WOTC screening. Don't leave money on the table—especially during hiring season and before the December 31 deadline.