The updates reflect legislation on tax relief for some qualified employers.
2/2/2021 14:00
The Internal Revenue Service has issued updated FAQs about recent legislation that extended and amended tax relief to certain small- and mid-sized employers under the Families First Coronavirus Response Act (FFCRA), according to a news release from the IRS.
The FAQs are available here: COVID-19-Related Tax Credits for Required Paid Leave Provided by Small and Midsize Businesses FAQs.
The COVID-related Tax Relief Act of 2020, enacted Dec. 27, 2020, extends the availability of the FFCRA tax credits to eligible employers for paid sick and family leave provided through March 31, 2021, as well as other changes to the credits, according to the IRS news release.
The extension of the tax credit availability is addressed in the updated FAQs.
“The paid sick and family leave credits, which previously were available only until the end of 2020, have been extended for periods of leave taken through March 31, 2021,” the IRS reports.
Under the paid sick leave credit, qualified businesses—those with fewer than 500 employees and that pay “qualified sick leave wages”—receive a “credit for wages or compensation paid to an employee who is unable to work (including telework) because of coronavirus quarantine or self-quarantine or has coronavirus symptoms and is seeking a medical diagnosis,” according to the IRS.
The qualified businesses may claim credit for an employee’s paid sick leave for up to two weeks (80 hours) at the employee’s regular wage at a maximum of $511 per day and $5,110 in total.
“In addition, an eligible employer can receive the paid sick leave credit for employees who are unable to work due to caring for someone with coronavirus or caring for a child because the child's school or place of care is closed, or the paid childcare provider is unavailable due to the coronavirus,” according to the IRS.
Eligible employers may claim the credit for paid sick leave provided to an employee for up to two weeks (80 hours) at two-thirds the employee’s regular wage, or up to $200 per day and $2,000 in total.
ACA International members can access a refresher on the FFCRA and paid leave during the ACA Huddle webinar, “Employment Decisions after FFCRA and CARES.”
Related Content from ACA International: