IRS gives guidance on tax credit under paid leave act

On March 20, 2020, the U.S. Treasury Department, Internal Revenue Service, and the U.S. Department of Labor announced that small and midsize employers can begin taking advantage of two new refundable payroll tax credits designed to immediately and fully reimburse them, dollar-for-dollar, for the cost of providing coronavirus-related leave to their employees.

This relief is provided under the Families First Coronavirus Response Act and is intended to help defeat COVID-19 by giving all American businesses with fewer than 500 employees the funds to provide those employees with paid leave, either for the employee's own health needs or to care for family members.

The legislation will enable employers to keep their workers on their payrolls, while at the same time ensuring that workers are not forced to choose between their paychecks and the public health measures needed to combat the virus.

Get more detailed information, including key takeaways, about the Act on the IRS website.

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