Washington, DC - In response to record high numbers of unemployed youth, Ways and Means Committee Chairman Charles B. Rangel (D-NY) today introduced H.R. 7066, to provide new tax incentives for employers to hire disconnected youth. This bill would amend the current Work Opportunity Tax Credit (WOTC) to include low-skill youth who have been out of work and school for the past six months.
“In a time of rising economic distress, our disadvantaged youth have little-to-no chance of finding employment," said Chairman Rangel. “The problem is so great that some of our minority youth face unemployment rates of nearly 30 percent. We need to send a message to all of our young people, regardless of where they live or who their parents are, that they are not out on their own. My bill would provide a Federal tax credit to businesses that step up and provide these young people with an opportunity to develop the skills that will help them move forward."
“My own life story illustrates the power of the American dream and we need to rekindle that dream for the youth of today and tomorrow," urged Rangel. “Let us keep in mind that what we’re doing isn’t an act of generosity. Our parents’ and grandparents’ generation have already shown us the way: making investments in these youth now will save us money as they work hard and stay in the labor force, return to school, and live productive lives. And they won’t just prosper alone; they’ll contribute to our communities, our country, and help American compete in an economy where the most inefficient decision we can make is deciding not to invest in our young people."
“Community organizations such as the Community Service Society of New York, led by David Jones, have long championed the cause of disadvantaged youth," said Rangel. “Their outstanding work has given me and my congressional colleagues a better understanding of the costs that this nation will bear if we fail to simply give these young men and women a helping hand."
The Work Opportunity Tax Credit provides employers with an incentive to employ certain groups of disadvantaged workers. An employer must employ a worker for at least 120 hours. For most eligible hires who are employed for at least 400 hours, employers can claim a credit against their income tax of up to $2,400 (40% of the first $6,000 in wages paid during the worker’s first year of employment). For most eligible hires who work at least 120 hours, but less than 400 hours, employers can claim a credit of $1,500 (25% of the first $6,000 in wages paid), hours. This proposal would include those youth aged 16 through 24 who are designated by a State employment security agency to have not been regularly employed or in school for the past 6-months and to lack sufficient basic skills for employment.
