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IRS Adds and Updates FAQs on FFCRA Tax Credits

The IRS has added and updated more than 80 answers to questions in its series of FAQs on “COVID-19-Related Tax Credits for Required Paid Leave Provided by Small and Midsize Businesses.” The changes affect questions in all 13 of the subtopics covered by the FAQs.

Refundable tax credits are available to businesses for employee paid leave taken under the federal Families First Coronavirus Response Act (FFCRA). FFCRA tax credits provide employers with funds to cover certain costs of the employee leave required by the law. Specifically, the tax credits are available for:

  • Qualified sick leave wages;
  • Qualified family leave wages;
  • Qualified health plan expenses allocable to employee leave wages; and  
  • The employer’s portion of Medicare tax related to the qualified wages.

Next Steps for Employers

Employers are encouraged to consult with their tax professional for additional guidance on tax credits and the completion of tax credit related forms and filings.

HR Works, headquartered in Upstate New York, is a human resource management outsourcing and consulting firm serving clients throughout the United States for over thirty years. HR Works provides scalable strategic human resource management and consulting services, including: affirmative action programs; benefits administration outsourcing; HRIS self-service technology; full-time, part-time and interim on-site HR managers; HR audits; legally reviewed employee handbooks and supervisor manuals; talent management and recruiting services; and training of managers and HR professionals.