Capitol Insights: WOTC Outlook as Sept. 30 Funding Deadline Nears

Welcome to our ongoing series focused on the renewal of the Work Opportunity Tax Credit (WOTC).

As Congress considers the future of this critical hiring incentive, our team is committed to keeping you informed with timely, accurate updates from Capitol Hill. Each installment of this newsletter highlights the latest legislative activity, policy discussions, and stakeholder engagement surrounding WOTC, ensuring you have the context and clarity needed to stay ahead.

We track the details so you don’t have to.

From committee hearings and bill introductions to behind-the-scenes negotiations, we monitor the developments shaping WOTC’s path forward. Our goal is to bring you concise, actionable insights into the conversations that matter most.

At a Glance:

• Government funding deadline:Sept. 30 → short-term resolution most likely to avoid a shutdown

• WOTC extension:reconciliation unlikely, year-end tax & healthcare extenders bill more probable

• WOTC advocacy: focus on amending H.R. 1177 and S. 492 to include multi-year extension

• Bipartisan support: building cosponsorship across both parties remains critical

• Outlook:clearer path expected after funding debate is resolved

Congress returned last week from its August recess and the highest legislative priority over the next two weeks is funding for US Government operations which will expire on September 30. As of now the more likely outcome of the funding debate is a short-term continuing resolution to give the White House and Congressional negotiators in both Parties more time to reach an agreement given there is very little time to reach an overall spending deal before the end of the month. Although Government operations were shuttered for over a month as a result of the lack of a deal during the first Trump Administration there appears to be a consensus now that a shut-down should be avoided.

There are two major potential vehicles for the adoption of proposals to pass a multi-year extension of WOTC and improvements, another partisan reconciliation bill or a year-end miscellaneous tax and healthcare extenders bill. Republican Leaders in Congress have expressed concern that it may be difficult to reach a consensus on a reconciliation bill amongst their Members only (Democrats will not support it) and while this option should not be discarded completely, it looks improbable. The alternative, a year end tax and healthcare extenders bill possibly including some adjustments to the recently approved reconciliation bill appears more likely.

The larger issues relating to spending and the nature of the next tax vehicle will eventually be resolved, and in the meantime, the priorities for the WOTC community are to work with key sponsors to amend the pending WOTC improvement bills (HR 1177 and S. 492) to add a multi-year extension and to build more cosponsorship by reaching out to Members both on Capitol Hill and in their states and districts. A greater showing of support will help move WOTC forward when an appropriate vehicle becomes available. WOTC has always had bipartisan support and the current effort is to continue that tradition by having support from Members of both Parties in roughly equal numbers.

The likely path forward legislatively will become clearer once the government funding issue is addressed.