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Court of Federal Claims Dismisses Employer’s Claim for Employer Tax Credits; Employees Were Denied Certification by State Employment Agencies as Belonging to the Statutorily Defined Targeted Groups
The Court of Federal Claims denied a taxpayer’s refund claim, and granted summary judgment for the government in an action in which the taxpayer (employer) sought refunds relating to certain employer tax credits—the Work Opportunity Tax Credit and Welfare- to-Work tax credit—that are available for hiring members of certain statutorily defined groups.
Manor Care, Inc. v. United States, 07-776T (Fed. Cl. October 27, 2009).
The taxpayer claimed that with regards to approximately 3,000 new employees alleged to be members of the statutorily defined targeted groups, the tax credits ought to have been allowed despite the fact that the employees were denied certification as belonging to those groups by the appropriate state employment security agencies. The Court of Federal Claims noted that the taxpayer had not submitted evidence that any of these employees actually were members of targeted groups. Rather, as the court noted, the evidence included forms signed by employees, indicating what type of government assistance they were receiving, and of the 3,000 employees, only three employees’ certification request forms were provided, showing the category of targeted groups, but not the basis for which certification was denied. The mere request for certification was not sufficient for the tax credit, contrary to the taxpayer’s claim, the court concluded.
For an electronic version of the court’s decision:
Manor Care
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