The HIRE Act amends the Internal Revenue Code to (1) extend the Work Opportunity Tax Credit (WOTC) statutory expiration from the end of 2025 to the end of 2030, and (2) make employers who hire Social Security Disability Insurance (SSDI) beneficiaries eligible to claim the WOTC. The bill accomplishes this by changing the sunset date in IRC §51(c)(4) and by adding a new targeted group to IRC §51(d).
Practically, the measure enlarges the pool of workers whose employers can generate a WOTC, subject to the existing certification process. It also creates an explicit role for the ‘designated local agency’ to certify SSDI entitlement within a 60-day lookback window, which has operational implications for employers, state workforce agencies, and tax compliance teams.
At a Glance
What It Does
The bill amends IRC §51(c)(4) to move the WOTC sunset to December 31, 2030 and revises IRC §51(d) to add a new targeted group for qualified Social Security Disability Insurance beneficiaries. It requires certification by the designated local agency that the hire was entitled to SSDI for any month ending within the 60 days prior to hire. The amendments apply to employees who begin work after December 31, 2025.
Who It Affects
Private employers that hire individuals receiving SSDI, payroll and tax compliance teams who prepare WOTC claims, state and local workforce agencies that act as designated certifying entities, and tax preparers who process WOTC claims for employers. It also affects SSDI recipients seeking employment.
Why It Matters
By formally adding SSDI beneficiaries to the list of WOTC-eligible groups, the bill changes hiring incentives and could shift employer recruiting toward a new pool of disabled workers. The certification requirement places new administrative tasks on designated local agencies and requires employers to integrate that step into hiring workflows.
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What This Bill Actually Does
The HIRE Act operates through two simple statutory changes: it pushes the WOTC’s existing sunset date forward and it creates a new eligible category within the WOTC for SSDI recipients. The bill does not alter how the credit is calculated, who may claim it, or other substantive WOTC mechanics; it simply expands the target population and extends the period during which claims can be made.
Under current practice, employers who want WOTC must obtain pre-certification from a designated local agency showing the new hire fits an eligible target group. This bill adds SSDI entitlement as one such target group, but it ties eligibility to a narrowly drawn lookback: the individual must have been certified as entitled to title II disability benefits for any month ending within the 60-day period before the hiring date.
That timing rule creates a definable window for certification requests and gives agencies a concrete standard to apply.Operationally, employers will need to ask new hires whether they are SSDI beneficiaries and then route certification requests to the designated local agency in the same way they handle other WOTC groups. State and local agencies that already process WOTC certifications will pick up this additional workload; the bill does not provide accompanying funding or change those agencies’ responsibilities.
Because the bill leaves credit rates, wage caps, and the rest of the WOTC framework untouched, employers should expect familiar claim mechanics but an expanded candidate pool that may change hiring decisions for entry-level and other eligible positions.
The Five Things You Need to Know
The bill amends Internal Revenue Code §51(c)(4) to change the WOTC sunset from December 31, 2025 to December 31, 2030.
It adds subparagraph (K) to IRC §51(d)(1) to designate 'a qualified social security disability insurance beneficiary' as a target group for the WOTC.
The measure defines a 'qualified social security disability insurance beneficiary' as an individual certified by the designated local agency as entitled to title II (SSDI) benefits for any month ending within the 60-day period ending on the hiring date.
The added eligibility applies only to individuals who begin work for the employer after December 31, 2025.
The bill does not change the WOTC’s credit calculation, wage limits, or other substantive claiming rules—only the eligible group and the credit’s statutory termination date.
Section-by-Section Breakdown
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Short title — 'Helping Individuals Rejoin Employment Act' (HIRE Act)
This section provides the act’s public name. It has no operative effect on tax administration, but it frames the measure’s purpose for stakeholders and guidance documents.
Extension of the WOTC statutory expiration to December 31, 2030
This subsection revises the date in IRC §51(c)(4), moving the WOTC sunset five years forward. For employers and tax advisors, this means the availability window for new qualified hires is extended; planning horizon for hiring incentives lengthens, but the bill does not change the annual or per-employee limits built into the credit itself.
Adds SSDI beneficiaries as a WOTC target group and defines certification standard
Subsection (b) contains two mechanics: it inserts a new subparagraph (K) into IRC §51(d)(1) to list SSDI beneficiaries among eligible groups, and it appends a new paragraph defining 'qualified social security disability insurance beneficiary.' The definition delegates the factual determination to the designated local agency and anchors eligibility to entitlement to title II benefits for any month ending within the 60 days before the hire date. Practically, this leverages the existing WOTC certification pipeline but requires agencies to verify SSDI entitlement, which could involve checking Social Security records or relying on applicant attestation plus agency verification processes.
Effective date for new hires
This subsection makes the amendments applicable to individuals who begin work for the employer after December 31, 2025. That means employers cannot claim the WOTC for SSDI hires whose employment started on or before that date under the new provision, and all compliance-ready processes (forms, certification requests) must be in place for hires in 2026 and later.
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Explore Employment in Codify Search →Who Benefits and Who Bears the Cost
Every bill creates winners and losers. Here's who stands to gain and who bears the cost.
Who Benefits
- SSDI beneficiaries seeking employment — By creating an explicit tax incentive for employers to hire people receiving SSDI, the bill increases the chances some beneficiaries will be considered for jobs they might otherwise be screened out of.
- Employers with entry-level and high-turnover positions — Businesses that typically rely on WOTC (retail, hospitality, manufacturing, staffing firms) gain an expanded pool of hires who can produce a tax credit without changing the credit’s calculation.
- Tax preparers and payroll advisors — Firms that prepare WOTC claims gain a new revenue stream by screening for SSDI eligibility and preparing additional certification paperwork.
- Workforce development organizations and community employment programs — These organizations can more directly link SSDI beneficiaries to employers seeking WOTC-eligible hires, potentially strengthening placement pipelines.
Who Bears the Cost
- Designated local agencies (typically state workforce agencies) — Agencies will need to process additional certification requests and verify SSDI entitlement without receiving programmatic funding in the bill.
- Employers (administrative burden) — Employers must collect evidence of SSDI entitlement, submit certification requests, and integrate this step into hiring workflows, increasing HR and payroll compliance work.
- Federal Treasury (reduced revenues) — Extending the program and adding an eligible group will likely increase WOTC claims and therefore reduce federal receipts relative to a world without the amendment.
- Tax-compliance teams and software vendors — They must update intake forms, screening workflows, and tax software to capture SSDI-related certification data and the 60-day lookback requirement.
Key Issues
The Core Tension
The central dilemma is whether a targeted tax incentive can meaningfully increase employment among SSDI recipients without creating administrative complexity or uneven access: the bill incentivizes employers to hire a population facing real barriers, but it places verification and processing burdens on state agencies and employers while leaving intact the deeper structural issues—benefit interactions, workplace accommodations, and supported employment services—that determine long-term job attachment.
The bill relies on the existing WOTC certification framework but does not fund or clarify how designated local agencies should verify SSDI entitlement. States may interpret 'certified by the designated local agency' differently, creating uneven access across jurisdictions.
If some agencies adopt streamlined verification and others require documentary proof, employers operating in multiple states could face inconsistent processes and timelines.
The 60-day lookback is both precise and narrow. It favors individuals who can document recent SSDI entitlement near their hiring date and may exclude long-term SSDI recipients whose entitlement preceded the 60-day window.
The provision also leaves untouched the core interaction between earnings and SSDI benefits: substantial work can affect benefit levels, and the tax credit does not address the longer-term incentives or supports (such as gradual benefit adjustments or supported employment services) that affect sustained employment outcomes.
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