Black Company paid wages of $180,000, of which $40,000 was qualified wages for the work opportunity tax credit under the general rules. Black Company's deduction for wages for the year is:

Question

Quizplus · Accepted Answer

The work opportunity tax credit is a credit for a percentage of wages paid to certain employees in certain targeted groups. The qualified wages allowed for the credit must be reduced from the deduction for wages. Therefore, Black Company's deduction for wages for the year would be $180,000 - $40,000 = $140,000. However, since we are looking for the deduction for wages only, the answer is $164,000.

Black Company Paid Wages of $180,000, of Which $40,000 Was