IRS Guidance: Emergency Paid Sick and FMLEA Leave Tax Credits Not Available Until April 1, 2020

For those of you who were not able to attend one of our recent webinars discussing the steps private businesses with less than 500 Employees need to take to implement the Emergency Paid Sick Leave Act (EPSLA) and Emergency Family and Medical Leave Act (EFMLEA), below are links to the YouTube video of the webinar, the PowerPoint Presentation, and more importantly, just-released IRS guidance regarding the tax credits.

Significantly, the IRS today issued Notice 2020-21, which provides that the tax credits for qualified sick leave wages and qualified family leave wages will only apply to wages paid for the period beginning on April 1, 2020, and ending on December 31, 2020. This means that, contrary to the informal guidance the IRS released on Friday, March 20, 2020, employers cannot apply the tax credits retroactively to payments made before April 1.  Please disregard any information to the contrary in the YouTube video and the PPT presentation regarding retroactive application of the tax credits.

Author: Erwin

Erwin Kratz practices exclusively in the areas of ERISA and employee benefits law, focusing on tax and regulatory matters relating to qualified and nonqualified deferred compensation and welfare benefits.