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IRS Issues Employer Resources on FFCRA Leave Tax Credits

The Internal Revenue Service (IRS) has released new resources explaining the tax credits available for employers who opt to continue to provide paid family leave and paid sick leave as established the Families First Coronavirus Response Act (FFCRA) and continued under the American Rescue Plan Act (ARPA) through September 30, 2021.

Businesses and nonprofits with fewer than 500 employees will be eligible for the tax credits for any paid vaccination leave, emergency paid sick leave or emergency paid family leave offered between April 1 and September 30, 2021. This includes up to 80 hours of paid sick leave in an amount equal to the employee’s regular wage, capped at $511 per day for a total of 10 workdays, for a total of up to $5,110. Of note, this is voluntary for employers, but if an employer chooses to offer these paid leave benefit and claim the tax credit, they should comply with all provisions of the FFCRA leave requirements.

Newly released resources from the Biden administration consist of a fact sheet and a “snapshot” document published on April 21, 2021.  These documents were released in conjunction with public remarks by President Joe Biden calling on employers to assist their employees in obtaining a COVID vaccination. Employers should review these resources for the instructions on how to claim the tax credits on quarterly tax filings and also discuss with your legal and tax advisors.

Read the Legal Update.

Contact your Cowden representative for more information on this or other compliance issues.