Form 8850 is used by employers to pre-screen and request certification of individuals as a member of a targeted group for the purpose of qualifying for the work opportunity credit. This lead article will explain the purpose of Form 8850, discuss key changes due to the Taxpayer Certainty and Disaster Relief Act of 2020, and provide information on who can complete the form.
What is Form 8850?
Form 8850 is used by employers to pre-screen applicants and submit a written request to the state workforce agency (SWA) to certify the applicant as a member of a targeted group for the work opportunity credit. Following successful certification, the employee must meet the minimum work hour requirement for the credit to be claimed by the employer through Form 5884 or Form 5884-C, depending on their organisation. The job applicant and employer must both sign the form no later than the date of submission to the SWA.
IRS Form 8850 – Who Needs to Fill It Out?
IRS Form 8850 must be completed and signed by both the job applicant and the employer before submitting it to the SWA for certification. If the employer believes the applicant to be a member of a targeted group, then the employer must fill out the rest of the form by the day the job offer is made, and both parties must sign the form by the date for submitting it to the SWA. For updated information, consult IRS.gov/Form8850.
Step-by-Step: Form 8850 Instructions For Filling Out the Document
Filling out Form 8850 is a two-step process. First, the job applicant must provide information to the employer prior to the job offer date and this information must be entered into the form. Then, the employer must fill out the remainder of the form no later than the job offer date, if they believe the applicant is a member of a targeted group. Both the job applicant and the employer must sign Form 8850 prior to submitting it to the State Workforce Agency. In order to qualify for the work opportunity credit, several requirements must be met including certification from the state workforce agency and the employee must meet a minimum number of hours worked. Guidance regarding amendments to extend empowerment zone designations is available on IRS.gov/Form8850.
Below, we present a table that will help you understand how to fill out Form 8850.
| Information Required for Form 8850 | Details |
|---|---|
| Two-Step Process | Steps to fill out Form 8850 |
| Job Applicant and Employer | Responsibilities of both parties |
| Qualifications for Work Opportunity Credit | Requirements to qualify for the credit |
| Amendments and Guidance | Information on amendments and guidance |
Do You Need to File Form 8850 Each Year?
Yes, Form 8850 must be completed each year in order to qualify for the work opportunity tax credit provided under the Taxpayer Certainty and Disaster Tax Relief Act of 2020. In order to receive the credit, employers must make a written request to the state workforce agency (SWA) to certify an individual as a member of a targeted group. After starting work, the employee must meet the minimum number-of-hours-worked requirement for the work opportunity credit before the credit for the related Form can be claimed.
Download the official IRS Form 8850 PDF
On the official IRS website, you will find a link to download Form 8850. However, to make it easier for you, we are providing the link in our article, which comes directly from the official irs.gov website! Click to download: Form 8850
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