Capitol Insights: Appropriations talks reopen a potential path for WOTC
Capitol Insights provides weekly perspective on federal policy changes that affect how employers approach tax credits and compliance. Each update reviews legislative activity with potential consequences for the Work Opportunity Tax Credit and broader hiring and incentive programs.
Latest update
Last week, Congress returned from recess facing overlapping deadlines on government funding, healthcare subsidies, and expired tax provisions, creating a renewed opening for a bipartisan tax package that could carry a WOTC extension. Support continued to build across parties, with key lawmakers signaling that WOTC remains a viable candidate for inclusion as negotiations move forward. Read Week 12 here .
At a glance:
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Congress is working toward appropriations legislation ahead of the January 31 funding deadline.
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Senate funding talks remain linked to the extension of enhanced healthcare premium subsidies.
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Lawmakers are weighing an omnibus bill to address spending, tax, and healthcare issues together.
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Employer and stakeholder engagement continue to keep WOTC part of the discussion.
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Recent House policy language reflects ongoing support for reauthorizing WOTC.
As the January 31 funding deadline approaches, Congress is focused on passing appropriations legislation to avoid a lapse in federal government funding. Current funding levels were set under a temporary continuing resolution approved late last year, making new legislation necessary to keep agencies operating.
In the Senate, any appropriations package will require bipartisan support. Senate Democrats have made clear that extending enhanced healthcare premium subsidies, which expired at the end of 2025, remains a central condition tied to funding discussions.
As a result, appropriations discussions are not occurring in isolation. Healthcare policy, tax provisions, and government funding are now intertwined as lawmakers work toward a broader agreement.
Why omnibus legislation matters for WOTC
The Work Opportunity Tax Credit has traditionally been extended through large legislative vehicles rather than as a standalone bill. When WOTC has been renewed or modified in the past, it has often been included as part of a comprehensive tax or spending package.
That pattern is relevant again this year. As lawmakers weigh how to address expiring tax provisions alongside appropriations and healthcare policy, discussions increasingly point toward a single omnibus vehicle as the most viable path forward. Within that context, employer outreach and stakeholder engagement have helped keep attention on the pending WOTC extension and enhancement bills (S. 3265 and H.R. 6231), reinforcing the credit’s relevance as part of wider economic and workforce negotiations.
House action and Senate negotiations continue
The House has already passed several appropriations bills and sent them to the Senate for consideration. Given the difficulty of advancing individual spending bills in the upper chamber, congressional leaders are expected to combine multiple measures into one or more omnibus packages.
Separately, the House approved a three-year extension of enhanced healthcare premium subsidies through a discharge petition, bypassing leadership opposition. Senate Majority Leader John Thune is now working to negotiate a compromise, as many Senate Republicans have expressed concerns about a straightforward multiyear extension.
Although the Senate adjourned for a ten-day recess, discussions around healthcare subsidies and broader funding issues are expected to continue during this period.
Timing challenges and the likelihood of another continuing resolution
The congressional calendar makes it unlikely that a full omnibus package will be finalized before the January 31 deadline. The House is not scheduled to be in session during the final week of January.
Despite those challenges, Senate Democratic leadership has indicated that another government shutdown is unlikely. With negotiations showing signs of progress, lawmakers appear open to passing a short-term continuing resolution to allow more time to complete a comprehensive deal. Members of the Appropriations Committees have emphasized that any additional extension should be brief.
Signals of support for WOTC
This week, the House Republican Study Committee released a policy document titled Making the American Dream Affordable Again, which included language supporting the reauthorization of the Work Opportunity Tax Credit. The document framed WOTC as an incentive for businesses to create jobs and hire individuals who face barriers to employment.
That framing aligns with themes that have emerged through ongoing grassroots communication and employer feedback. These efforts have emphasized WOTC’s role not only as a hiring incentive, but as a policy tool that supports workforce participation while helping reduce long-term reliance on public assistance at both the federal and state levels.
Outlook for employers
Over the coming weeks, the future of WOTC will remain closely tied to broader negotiations over federal funding, healthcare subsidies, and tax policy.
For employers, this environment underscores the importance of staying informed as discussions continue. While legislative timing remains uncertain, continued employer and community-level input is expected to remain part of the policy landscape as lawmakers determine which provisions advance within an eventual omnibus package.
If you have questions about how these developments may affect your organization, contact Maximus to discuss WOTC considerations and next steps.
