COVID Tax Tip 2020-53: COVID-19 paid leave tax credits for small and midsize businesses

IRS Tax Tips May 7, 2020
Useful Links: IRS.govHelp For Hurricane Victims News Essentials What's HotNews ReleasesIRS - The BasicsIRS GuidanceMedia ContactsFacts & FiguresAround The Natione-News Subscriptions The Newsroom Topics Multimedia CenterNoticias en EspañolRadio PSAsTax Scams/Consumer AlertsThe Tax GapFact SheetsIRS Tax TipsArmed ForcesLatest News IRS Resources Compliance & Enforcement NewsContact Your Local IRS OfficeFiling Your TaxesForms & InstructionsFrequently Asked QuestionsTaxpayer Advocate ServiceWhere to FileIRS Social Media	Issue Number: COVID Tax Tip 2020-53 COVID-19 paid leave tax credits for small and midsize businesses   Small and midsize employers can claim two new refundable payroll tax credits.  The paid sick leave credit and the paid family leave credit are designed to immediately and fully reimburse eligible employers for the cost of providing COVID-19 related leave to their employees. Here are some key things to know about these credits. Coverage •  Employers receive 100% reimbursement for required paid leave. •  Health insurance costs are also included in the credit. •  Employers do not owe their share of social security tax on the paid leave and get a credit for their share of Medicare tax on the paid leave. •  Self-employed individuals receive an equivalent credit. Fast funds •  Reimbursement will be quick and easy. •  The credit provides a dollar-for-dollar tax offset against the employer's payroll taxes  •  The IRS will send any refunds owed as quickly as possible. To take immediate advantage of the paid leave credits, businesses should use funds they would otherwise pay to the IRS in payroll taxes. If those amounts are not enough to cover the cost of paid leave, employers can request an expedited advance from the IRS by submitting  Form 7200, Advance Payment of Employer Credits Due to COVID-19. For details about these credits and other relief, visit Coronavirus Tax Relief on IRS.gov. Share this tip on social media -- #IRSTaxTip: COVID-19 paid leave tax credits for small and midsize businesses. https://go.usa.gov/xvGyC   Back to Top        Thank you for subscribing to IRS Tax Tips, an IRS e-mail service. For more information on federal taxes please visit IRS.gov.This message was distributed automatically from the IRS Tax Tips mailing list. Please Do Not Reply To This Message.

 

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