The FFCRA was expanded under the new stimulus package after originally ending in 2020. If you’re a small business owner, you may benefit from these credits.
Here’s what you need to know about the FFCRA updates:
- Paid leave for COVID reasons has been extended through March 31, 2021.
- The FFCRA paid leave is now optional. You can still receive tax credits on your 941 for any of those wages paid through the first quarter.
- This is a continuation of the same bank of hours. That means that employees have a total of 80 hours to use. For example, if you had an employee who used 40 hours in 2020, they would only be eligible for 40 more hours in 2021.
- There is no tax credit for the public sector. The tax credit is only available for private employers.
- If employers choose to continue then the same rules from the original FFCRA will apply.
- Private sector employers with less than 500 employees
- If you choose to extend FFCRA, make sure you offer it to everyone equally according to original FFCRA guidelines.
What it is:
- Up to 80 hours of paid sick leave and an additional 10 weeks of childcare.
Payroll tax credit:
- Applies to both emergency sick leave and expanded FMLA
- Refund possible for wages paid that exceed available payroll taxes paid.
- Dollar for dollar credit measured against your quarterly payroll taxes.
- An employee who must be quarantined and cannot work: full pay capped at $511 per day
- Employee has been advised to self quarantine: full pay capped at $511 per day
- Employee has COVID-19 symptoms and is seeking medical diagnosis: full pay capped at $511 per day
- Employee is caring for a sick or quarantined person: ⅔ regular pay capped at $200 per day
- Employee caring for a child whose school or daycare is closed: ⅔ regular pay capped at $200 per day
For even more details on the FFCRA and how it can help your small business, watch a short (less than 10 minutes) training video here.