Tax Updates to Employee Sick Leave and
Family Sick Leave
The IRS has extended the paid sick and family leave credits, for periods of leave taken through March 31, 2021. Qualified businesses include those with less than 500 employees and who pay “qualified sick leave wages” to get a credit for wages or compensation paid to an employee who is unable to work (including telework) because of coronavirus quarantine, self-quarantine or has coronavirus symptoms and is seeking a medical diagnosis.

Eligible employers may claim credit for paid sick leave provided to an employee for up to two weeks (up to 80 hours) at the employee's regular rate of pay up to $511 per day and $5,110 in total. 

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Family Leave Credit - Tax Updates
The Family and Medical Leave Act (FMLA) generally entitles eligible employees of covered employers to unpaid, job-protected leave for specified family and medical reasons. 

The 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.

Qualified family leave wages are wages provided when an employee is unable to work or telework 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.

The IRS states that employers are entitled to a paid family leave credit for paid family leave provided to an employee equal to 2/3 of the employee's regular pay, up to $200 per day and $10,000 in total. Up to 10 weeks of qualifying leave can be counted towards the family leave credit.
In Case You Missed It....
Employee Retention Credit - 2021 Changes
The Consolidated Appropriations Act signed into law by President Trump on December 27, 2020, makes significant changes to the employee retention credit for 2021. New guidance measures were issued January 19, 2021 on how to claim the credit for the retroactive measures and for advance payments for the new provisions in 2021.

Forms for this credit have not been finalized as of January 20, 2021.
We are currently reviewing the guidance measures issued to help limit the taxes our clients pay and to ensure that our clients received the full benefits of this act. To read the high-level overview of the ERC, Click below.
Links To Additional Resources
IRS Mobile App, Click Here
IRS Free File, Click Here
IRS Recovery Rebate center, Click Here
Where's My Refund Tool, Click Here
Tax Treatment of Unemployment Benefits, Click Here
COVID Tax Relief Info, Click Here
Full IRS Notice on 2021 Tax Filing Season, Click Here

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