Small and midsize employers can now begin taking advantage of two refundable payroll tax credits designed to reimburse employers dollar-for-dollar for the cost of providing COVID-19-related leave to their employees. The relief is provided under the Families First Coronavirus Response Act, signed into law March 18.
The act will give American businesses with fewer than 500 employees funds to provide employees with paid leave, either for the employee's own health needs or to care for family members. The legislation allows employers to keep workers on their payrolls while also making it so workers are not forced to choose between their paycheck or their health.
Under the legislation, employees can receive up to 80 hours of paid sick leave and expanded paid child care for COVID-19-related reasons. Employers can also receive full reimbursement for paid leave pursuant to the act and face no payroll tax liability. Employers with fewer than 50 employees are eligible under the act for an exemption from the requirements to provide leave to care for a child whose school is closed or child care is unavailable where the viability of the business is threatened.