Employers Have the Opportunity to Permit Employees to Donate Accrued and Unpaid Time Off to Fellow Employees in Need

Generally, individuals who have wanted to donate PTO could not do so without triggering adverse tax consequences. However, that can be resolved if an employer establishes a plan as a medical emergency leave plan or a qualified major disaster leave plan. Under these arrangements, employees can voluntarily contribute their earned and unused PTO for the benefit of other employees in need. If structured properly, the donor is not taxed and the recipient receives the donated time as taxable wages.

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