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Details on the New Family and Medical Leave Tax Credit.

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A business tax credit for employers that provide paid family and medical leave under the new tax law is equal to a percentage of wages paid to qualifying employees while on family and medical leave. The percentage ranges from 12.5%-25%, depending on the circumstances. Currently the credit is available only for tax years 2018 and 2019. Key factors: The employer must have a written policy that: n provides leave to all qualified employees; n allows at least 2 weeks of annual leave for each full-time employee; and n pays at least half of an employee’s wages while on leave. There are other requirements, too. The IRS has issued new FAQs, which detail eligible employer requirements, types of leave covered, minimum paid leave requirements, calculation of the tax credit, and the impact of state-mandated leave on the availability and calculation of the credit.

For more information on how this affects you or your business, contact us here.

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