The Consolidated Appropriations Act of 2021 (CAA) extends the tax credits that reimburse you for any emergency paid sick or family leave you provide under the Families First Coronavirus Response Act (FFCRA). Below, we outline what you need to know about this new provision.
Note: The American Rescue Plan Act further extends this program until September 30, 2021. For more information about the most recent legislation and additional changes to this program, please click here.
Under the FFCRA, you were required to provide eligible employees with Emergency Paid Sick Leave and Emergency Family and Medical Leave. This program expired on December 31, 2020 and has not been extended. This means that you do not need to provide leave under the FFCRA in 2021.
However, the CAA does extend the related FFCRA tax credits until March 31, 2021. This means that you may voluntarily provide leave under the FFCRA to employees with eligible leave remaining. If you choose to do this, you may continue to receive the corresponding tax credits for those leave payments until March 31, 2021.
What Do I Need to Do?
While providing leave under the FFCRA is optional at the Federal level, it may be required at the state or local level. Before deciding not to provide leave under the FFCRA, check your state and local laws to ensure you comply with any paid leave requirements.
If state or local laws require you to provide emergency paid sick or family leave, you may want to take advantage of the FFCRA tax credits to be reimbursed for those leave payments.
If you provide leave under the FFCRA for any reason, you must comply with the rules and regulations set under the Act in order to receive the corresponding tax credits. This includes understanding employee eligibility requirements and keeping accurate records. You must also be careful not to discriminate or retaliate against employees who use this leave.
How Sentric Can Help
Our systems are equipped to properly track and process the extended FFCRA-related leave and tax credits. For more information about how Sentric and our tax software can help you track leave under the FFCRA, please contact one of our product experts.
For an overview of the CAA and its main provisions, please check out The Consolidated Appropriations Act of 2021 (CAA): What Employers Need to Know.