Trucker and Huss released a clarification on the recent tax credit for the Family and Medical Leave.
“Section 13403 of the Act added the paid family and medical leave credit as a new general business credit under Internal Revenue Code (the “Code”) section 38. However, the credit is a temporary addition to the tax code because it only applies to paid leave provided January 1, 2018 through December 31, 2019. Generally, an eligible employer may claim the tax credit based on wages paid to qualifying employees on leave for any of the purposes listed under the Family and Medical Leave Act (FMLA), provided that certain conditions are met.”
To claim the credit, an “eligible employer” must have a written leave policy that:
- Provides at least two weeks of paid family and medical leave annually to all full-time qualifying employees (the duration of the paid family and medical leave may be prorated for part-time qualifying employees);
- Pays qualifying employees at least 50% of their normal wages; and
- Ensures that the employer will not interfere with, restrain, or deny any rights provided under the policy, or discriminate against any individuals.”
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