Pathways to Careers
Designed to both ensure the availability of resources for potential employment supports and as an incentive, the Employer Payroll Tax Adjustment is a pay-as-you-go model that lowers an employer’s Federal payroll tax payment based on the direct employment of individuals who receive or have received SSI and/or SSDI. Depending on the wage, number of hours worked and whether or not the employer provides healthcare coverage, the EPTA reduction can amount to as much as $7,000 annually. The EPTA is intended as a resource for the employer to use as needed to ensure that the individual is receiving necessary on-the-job supports to ensure employment success.

The EPTA concept is modeled on the traditional insurance concept of risk management. Private disability insurance providers often “experience rate” their customers based on the extent to which the customer facilitates the continued employment of an employee who would otherwise be unemployed and eligible for private disability insurance benefits. The more successful the employer is in this regard, the lower the insurance premium. The EPTA approach represents a public version of the same approach with FICA being treated as the insurance premium being paid by the employer. It directly addresses the current need for long-term funding for ongoing employment supports by providing employers with the financial resources to meet the employment support needs

Currently, the EPTA is simulated through a direct payment from the Pathways to Careers to the employer. It is the intention that this demonstration serves as support for future EPTA inclusion into the IRS Tax Code.

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