Honor and Hire Veterans Act of 2025
The Honor and Hire Veterans Act of 2025 would revise the Work Opportunity Credit (WOTC) in the Internal Revenue Code to make it more favorable for employers who hire veterans. Specifically, it would: - Increase the WOTC for qualified veterans to 50% of their first-year wages (up from 40% for most groups), while maintaining a 40% credit for all other targeted groups. - Raise the wage bases used to calculate the credit, expanding the amount of wages that can be counted toward the credit (from $12,000/$14,000/$24,000 to $18,000/$21,000/$36,000, respectively). - Change how the credit is calculated if the employee does not meet the minimum employment period, reducing the portion of the credit to 25% of wages (instead of 50% for veterans and 40% for others). - Apply these changes to individuals who begin work after the enactment date, i.e., not retroactive to those who started earlier. Overall, the bill aims to boost incentives for employers to hire veterans by increasing the credit amount and the wage base while tightening treatment for short-term employment.
Key Points
- 1Increases the veteran portion of the WOTC to 50% of qualified first-year wages for qualified veterans.
- 2Keeps the non-veteran WOTC at 40% of qualified first-year wages for all other targeted groups.
- 3Raises wage-base limits used to compute the credit: from $12,000 to $18,000; from $14,000 to $21,000; and from $24,000 to $36,000.
- 4Adjusts the minimum-employment-period rule: if the employee does not meet the required period, the credit is reduced to 25% (for both veterans and non-veterans, with the corresponding 50%/40% replaced by 25% in the calculations).
- 5Effective upon passage: applicable to individuals who begin work after enactment.