Tax Credit Prolonged By way of September 2021 For Employers Voluntarily Offering Workers With Paid FFCRA Depart – Employment and HR

United States:

Tax credits extended to September 2021 for employers who provide voluntarily paid FFCRA leave to their employees

April 02, 2021

Buchanan Ingersoll & Rooney PC

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Shortly before the one-year anniversary of President Trump’s signing of the Families First Coronavirus Response Act (FFCRA) on March 18, 2020, Congress and the Biden Administration gave employers tax incentives to voluntarily continue to provide paid time off under the FFCRA.

The FFCRA urged private employers with fewer than 500 employees to grant their employees paid sick leave (EPSL) and family and emergency medical leave (EFMLA) in certain circumstances related to COVID-19. The mandatory obligation to provide such vacation ended on December 31, 2020.

In December 2020, the Coronavirus Response and Relief Supplemental Appropriations Act 2021 (CRRSA) authorized employers to receive tax credits if they voluntarily granted FFCRA leave to employees between January 1, 2021 and March 31, 2021

On March 11, 2021, President Biden signed the American Rescue Plan Act of 2021. Pursuant to Section 9641 of the American Rescue Plan, the IRS may continue to grant tax credits to employers who voluntarily grant FFCRA vacation through September 30, 2021, and expand FFCRA benefits in the following ways:

Voluntarily providing paid FFCRA vacation between April 1, 2021 and September 30, 2021 can benefit both employers and employees. As we mentioned in our webinar “Vaccine Mandates in the Workplace – Roll Out or Roll Back?” Have recommended that employers should strongly encourage workers to get vaccinated instead of a mandatory vaccination policy. The expanded FFCRA eligibility criteria allow employees to get vaccinated and recover from potential side effects without having to worry about wages or the nature of paid or unpaid time off. For employers who grant FFCRA voluntary paid leave, they can apply for tax credits.

While employers can choose to continue offering paid sick leave and / or paid FMLA vacation in order to receive tax credits for the payments, they must provide paid time off for all of the reasons listed, including the new ones mentioned above. Therefore, employers who choose to continue granting FFCRA paid vacation through September 30, 2021 should update their policies to include the new reasons for vacation, the additional 10 days of paid sick leave, and the expanded $ 12,000 cap on family paid vacation that are available.

The content of this article is intended to provide general guidance on the subject. A professional should be obtained about your particular circumstances.

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