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Paycom Streamlines Employers’ WOTC Tax Credit Services Following Government Extension

December 23, 2015 | Tags:
Posted in Press Room

Paycom Software, Inc. (NYSE:PAYC), a leading provider of comprehensive, cloud-based human capital management software, continues to aid its clients in their pursuit of Work Opportunity Tax Credits (WOTC) following the passage of the bipartisan bill, Protecting Americans from Tax Hikes Act of 2015.

The bill extends WOTC five years retroactively for hires from Jan. 1, 2015 through Dec. 31, 2019, allowing employers to collect tax credits for qualifying individuals, while also adding long-term unemployment recipients as a new target group. In order to obtain WOTC, employers must identify eligible employees on or before the day of their job offer; Paycom has been diligent in its efforts to help clients comply with these guidelines.

Until now, companies have been screening their employees for WOTC without any guarantee that previous tax credit programs would be renewed or that the potential credit would be realized for new hires in 2015. Now that the bill has passed, those credits will soon come to fruition.

“This bill creates certainty for employers as they plan their tax, hiring and business strategies,” said Paycom’s founder and CEO, Chad Richison. “Paycom’s single-database software allows employers to pre-qualify employment candidates for any available federal tax credits based on geography or demographics during the application process.”

Paycom’s tax credit service offers businesses the ability to pre-screen qualified candidates instantly to see who is potentially eligible. Paycom’s single-database architecture gives clients the ability to immediately tell if a potential employee would qualify for a credit. These qualified employees’ data flows seamlessly throughout their employers’ payroll records upon hire. Employers participating in WOTC could receive $2,400 to $9,600 for each certified employee. Clients utilizing Paycom’s application only pay tax credit services if credits are found. In 2015, Paycom was able to assist its clients in securing millions of dollars in tax credits.

WOTC has been in hiatus as recently as 2014, but even during this interval, organizations were still required to have the IRS Form 8850 signed by new employees. Paycom files forms on behalf of its clients and submits them to the State Workforce Agency for certification within a 28-day window from the start date. If permitted, the IRS’ transition relief would allow employers a short period of time to claim retroactive WOTC credits without the need to complete the 8850 on or before the job offer and within the 28-day requirement. A similar transitional relief provision was passed for the first time in 2014.

“As was the case during the 2014 hiatus, we assume but cannot verify at this time the IRS will allow for a transitional relief opportunity to capture tax credits on all hires that occurred during 2015 that did not fully comply with the timing provisions,” said Paycom’s director of tax credits, Rich Stupansky.

Forward-Looking Statements Certain statements in this press release may be forward looking statements within the meaning provided under the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are made only as of the date hereof. These statements involve known and unknown risks and uncertainties that may cause Paycom’s actual results to differ materially from those stated or implied by such forward-looking statements, as a result of various risks and uncertainties including: the decision by the Department of Labor and Internal Revenue Service whether to permit transition relief for WOTC, changes in the demand for our solution, pricing changes and the impact of competition; changes in technology; our ability to attract, hire and retain skilled employees; our ability to attract and retain clients and increase the number of applications utilized by our clients; our ability to develop and market new applications, improve our existing applications and increase the value of our solution; our ability to maintain or increase our revenues and revenue growth rate; the sufficiency of our cash and cash equivalents and cash generated from operations to meet our working capital and capital expenditure requirements; changes in laws regulating payroll taxes and employee benefits; the possibility of a security breach that disrupts operations or exposes client confidential data; our ability to create additional jobs at our corporate headquarters; our ability to obtain financing for our corporate headquarters; our ability to expand our corporate headquarters within an expected timeframe; our ability to obtain a local incentive package from the city of Oklahoma City; and potentially unfavorable outcomes related to pending legal matters.

Other factors that may cause such differences include, but are not limited to, those discussed in our periodic filings with the Securities and Exchange Commission, including those discussed in “Item 1A. Risk Factors” in the Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 26, 2015 and in subsequent Quarterly Reports on Form 10-Q filed with the Securities and Exchange Commission. Paycom undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by applicable securities laws.

About Paycom

As a leader in payroll and HR technology, Oklahoma City-based Paycom redefines the human capital management industry by allowing companies to effectively navigate a rapidly changing business environment. Its cloud-based software solution is based on a core system of record maintained in a single database for all human capital management functions, providing the functionality that businesses need to manage the complete employment lifecycle, from recruitment to retirement. Paycom has the ability to serve businesses of all sizes and in every industry. As one of the leading human capital management providers, Paycom serves clients in all 50 states from offices across the country.