Tax Credits for Paid Sick and Paid Family and Medical Leave

Question

Debbie Sparks · Accepted Answer

Employers are entitled to a refundable tax credit equal to 100 percent of qualified paid sick leave wages paid by an employer for each calendar quarter, applied against the employer’s portion of Social Security and Medicare taxes. This credit only applies to Emergency Paid Sick Leave wages. The credit amount varies depending on whether the sick leave is taken for the employee’s own illness, or to care for a family member:

For the employee’s own illness, the amount of qualified sick leave wages taken into account for each employee is capped at $511 per day and $5,110 annually.
For amounts paid to employees caring for a family member, the amount of qualified sick leave wages taken into account for each employee is capped at $200 per day, and $2,000 annually.
For both the emergency paid sick and paid family leave, the credit shall be increased by the employer’s share of medical premiums associated with leave payments

SOURCE: Paylocity Article ID: PCTY-84561