Disclaimer:

The information contained here has been prepared by Civitas Strategies Early Start and is not intended to constitute legal, tax, or financial advice. The Civitas Strategies Early Start team has used reasonable efforts in collecting, preparing, and providing this information, but does not guarantee its accuracy, completeness, adequacy, or currency. The publication and distribution of this information is not intended to create, and receipt does not constitute, an attorney-client or any other advisory relationship. Reproduction of this information is expressly prohibited.

In the table below, enter leave taken between April 1, 2020 to September 30, 2021 due to care of an individual under COVID-19 related quarantine, care of a child whose school, place of care, or childcare provider was closed due to COVID-19.1 Enter the total on Line 2 of Form 7202 IRS.

How does it work?

The FFCRA covers leave taken between April 1, 2020 and September 30, 2021.

There are two types of leave available.

EMERGENCY PAID SICK LEAVE ACT (EPSLA)

First, the Emergency Paid Sick Leave Act (EPSLA) provides up to 80 hours of sick leave for employees:

• At their regular rate of pay (up to $511 per day with a cap of $5,110 for the whole 80 hours) if the employee is quarantined for potential COVID-19 exposure or has COVID-19 symptoms.

• At two-thirds their regular rate of pay (up to $200 per day with a cap of $2,000) if the employee is caring for someone under quarantine or a child (under 18) whose school or child care provider is closed or unavailable for reasons related to COVID-19. A school closure includes remote learning situations where the child is at home.

EMERGENCY FAMILY AND MEDICAL LEAVE EXPANSION ACT (EFMLEA) Second, the Emergency Family and Medical Leave Expansion Act (EFMLEA) provides up to 12 weeks of expanded family and medical leave with 10 of those weeks paid at two-thirds the employee’s regular rate of pay (up to $200 per day with a cap of $2,000) if the employee is unable to work (including telework) to care for a child whose school or childcare provider is closed due to COVID-19. A school closure includes remote learning situations where the child is at home.

How do I get reimbursed?

You get reimbursed through a “refundable tax credit.” That’s a technical way of saying the United States Treasury pays you using money from employment taxes. Think of this term as simply a “reimbursement” for the applicable wages.

Reimbursement is handled differently if the employee taking the leave is a “W-2 employee” or a sole proprietor/self-employed individual.

For W-2 Employees

You can get reimbursement for W-2 employees by revising past FORM 941 submittals using an amendment (FORM 941X and instructions).

For Sole Proprietors & the Self-Employed

It is important to know you can claim the credit for 2020 or 2021, even if you already submitted your taxes. You will need to ask your tax preparer to file a FORM 1040X (instructions for Form 1040X) and use Form 7202: Credits for Sick Leave and Family Leave for Certain Self-Employed Individuals. To help you with this process, we have created Attachment A, which provides a way to share the data (and how to use the credit) with your tax preparer.

What else should I know?

Employers may exclude healthcare providers or emergency responders from EPSLA and EFMLEA leave, and businesses with less than 50 employees can qualify for an exemption if the leave would jeopardize the viability of the business.

For more information:

Visit the US Department of Labor website.

Attachment A:

Supplemental Worksheet for Form 7202 IRS Credits for Sick Leave and Family Leave

In accordance with the Families First Coronavirus Response Act, sole proprietors must use Form 7202 IRS to report the number of days unable to perform services between the dates of April 1, 2020 through December 31, 2020 as a result of government-ordered closures, COVID-19 related self-quarantine, caring for an individual under quarantine, or caring for a child whose school, place of care, or childcare provider was unavailable due to COVID-19. Use the worksheet below to complete Form 7202 IRS and enter the resulting total on Line 12b on Schedule 3 (1040) Additional Credits and Payments as a qualified sick and family leave credit.

In the table below, enter leave taken between April 1, 2020 to September 30, 2021 due to COVID-19 related government-ordered business closures or COVID-19 related self-quarantine. Enter the total on Line 1 of Form 7202 IRS.