Capitol Insights: WOTC support holds as Congress heads into July recess
Capitol Insights offers ongoing updates on federal legislative activity that may influence employer tax incentives and workforce programs. Each edition reviews congressional developments that could determine the future of the Work Opportunity Tax Credit (WOTC) and related hiring initiatives.
Latest update
We looked at how cryptocurrency tax legislation and a potential third budget reconciliation package have emerged as leading opportunities for WOTC renewal. Read the previous update .
At a glance:
- Six months after WOTC expired, bipartisan support for renewing and strengthening the program remains strong.
- The conversation has shifted from building support for WOTC to identifying the tax bill most likely to move it forward.
- Cryptocurrency legislation, budget reconciliation, and year-end legislation remain the leading opportunities for renewal.
- Congress returns July 13 before entering a compressed legislative calendar leading into the November midterm elections.
Where WOTC stands heading into the second half of 2026
Six months into 2026, the outlook for the Work Opportunity Tax Credit has become much clearer. When WOTC expired at the end of 2025, employers were left with several important questions. Would Congress introduce renewal legislation? Would lawmakers consider updates to strengthen the program? And how quickly could WOTC become part of a broader tax package?
Since then, bipartisan legislation has been introduced in both the House and Senate, support for WOTC has remained strong, and several legislative paths have emerged as potential opportunities for renewal. The conversation has evolved again in recent weeks. Rather than asking whether WOTC should be renewed, discussions are increasingly focused on when Congress can realistically act and which broader tax bill offers the best opportunity to carry WOTC forward.
Where could WOTC move next?
Congress has historically renewed WOTC as part of larger tax legislation rather than through a standalone bill. That remains the approach lawmakers are considering today.
Cryptocurrency tax legislation
The House Ways and Means Committee continues developing bipartisan legislation addressing cryptocurrency taxation. The committee is expected to revisit the bill after lawmakers return in mid-July, making it one of the earliest opportunities for additional tax provisions. WOTC supporters continue encouraging committee leadership to include the credit if the legislation expands beyond cryptocurrency tax policy.
Budget reconciliation
House Republicans continue discussing a third budget reconciliation package that could include tax provisions. If that effort moves forward, it could provide another opportunity to advance WOTC alongside broader tax priorities.
Year-end legislation
Year-end legislation should not be viewed simply as a backup plan. Congress has frequently used post-election sessions to complete unfinished tax and budget legislation, including tax extenders. Recent discussions with lawmakers continue to point to a year-end omnibus package as a realistic path if summer legislation does not advance.
All three paths remain under active discussion, giving lawmakers multiple opportunities to move WOTC forward during the second half of the year.
From policy debate to legislative timing
The Senate is in recess through July 13, and the House is expected to follow. After lawmakers return, Congress will have only a short legislative window before attention increasingly turns toward the November 3 midterm elections. With fewer working days available before the election, finding the right legislative path has become just as important as maintaining bipartisan support.
| Timeframe | What to expect |
|---|---|
| Now through July 13 | Congress is in recess while committee work, stakeholder meetings, and grassroots advocacy continue behind the scenes. |
| Mid to late July | Lawmakers return for a brief legislative window. Cryptocurrency legislation and budget reconciliation remain the primary opportunities to watch. |
| August through Election Day | The legislative calendar becomes more limited as attention shifts toward the November elections, reducing opportunities for major tax legislation. |
| Post-election (Lame Duck) | Congress has historically used Lame Duck sessions to complete unfinished tax and budget legislation, making year-end negotiations another important opportunity for WOTC renewal. |
Why employers should keep WOTC on the radar
Congress's calendar may become quieter over the coming months, but work surrounding WOTC is not expected to stop. Congressional sponsors continue meeting with stakeholders, advocacy organizations remain engaged, and grassroots efforts continue reinforcing bipartisan support while keeping WOTC top of mind as lawmakers evaluate broader tax legislation. Although public attention may shift during the election season, the conversations shaping future legislation are expected to continue behind the scenes.
For employers, that means WOTC should remain part of broader workforce and tax planning rather than move to the sidelines until renewal is finalized. The months ahead remain an opportunity to revisit your WOTC strategy, estimate potential tax credit value, evaluate how WOTC administration fits into your hiring process, and ensure your organization is prepared if renewal legislation advances.
Organizations that wait until legislation is enacted may find themselves restarting conversations they could have been having throughout the year. The business case for understanding WOTC has not changed, even as the legislative process continues.
With the second half of the year about to begin, WOTC remains firmly part of the legislative conversation. The months ahead are expected to determine which legislative path ultimately carries renewal forward.
