Vogel Law Firm
  • Home
  • Professionals
  • Practice Areas
  • Blog
  • Careers
  • Client Portal
  • Testimonials
  • Contact

call us today
866-771-9930

  • Home
  • Professionals
  • Blog
  • Careers
  • Client Portal
  • Testimonials
  • Contact
  • X Close
CONTACT

BLOG

UPDATE TO FAMILIES FIRST CORONAVIRUS RESPONSE ACT – TAX CREDITS

by rebeccablanshan | Apr 1, 2020 | COVID-19, Employment Law

Notice 2020-21, recently released by the IRS, provides that tax credits for qualified sick leave wages and extended family leave wages required to be paid by the Families First Coronavirus Response Act (“Act”) will apply to wages paid for the period beginning on April 1, 2020, and ending on December 31, 2020.

There has been some confusion regarding the procedural means by which employers can obtain the benefit of the tax credits provided by the Act.  The tax credits offered under the Act are equal to one hundred percent of an employer’s payments of qualified sick leave and expanded family leave (with increases for applicable health insurance premiums and the employer’s share of Medicare tax (1.45%) on qualified payments).   The Act (H.R. 6201), provides that the tax credits are to be applied against the employer’s share of Social Security tax (6.2%).

However, in an attempt to make the tax credits available to employers on a more immediate basis, IRS guidance (IR-2020-57) indicates that employers may retain from all employment taxes that would otherwise be submitted to the IRS, amounts equal to qualifying leave payments paid under the Act.   Based on this guidance, employers may retain from both the employer’s share and the withheld employee’s share of Social Security and Medicare tax and from withheld federal income tax in amounts sufficient to cover the costs of qualifying leave under the Act.

This type of accelerated access to the tax credits makes sense, since under the Act, any amounts not recoverable against the employer’s 6.2% Social Security tax was to be refunded by the IRS.  Allowing an offset of the tax credits against all employment taxes provides immediate access to the cash employers need during this crisis, while eliminating numerous refund claims for the IRS to process.

In more recent legislation, known as the CARES Act (Coronavirus Aid, Relief, and Economic Security Act, H.R. 748), clarification was provided that the limits specified in the Act for qualifying leave payments ($511 per day and $5,110 in the aggregate for qualifying sick leave; $200 per day and $10,000 in the aggregate for extended family leave) applies to each employee, and not to the employer’s workforce in the aggregate.

Also under the CARES Act (Section 2302), employers and self-employed individuals are permitted to delay 100% of the employer’s share of social security taxes due after March 27, 2020 through the end of 2020, with 50% of the deferred amount to be paid by December 31, 2021 and the remaining 50% to be paid by December 31, 2022.

To Save or Print this Post Click Here for PDF Version.

Disclaimer:
These materials are for informational purposes only and not for the purpose of providing legal advice. You should contact your attorney to obtain advice with respect to any particular issue or problem. Use of and access to these materials does not create an attorney-client relationship between the Vogel Law Firm and the user or browser. The opinions expressed at or through these materials are the opinions of the individual author and may not reflect the opinions of the Vogel Law Firm or any individual attorney. Under no circumstances shall the Vogel Law Firm have any liability to you for any loss or damage of any kind incurred as a result of the use of the information or your reliance on any information provided.

  • Facebook
  • Twitter
  • LinkedIn

Categories

  • Bankruptcy (3)
  • Business Law (4)
  • Child Custody (1)
  • COVID-19 (32)
  • Criminal Defense (8)
  • Debtor/Creditor (2)
  • Divorce (2)
  • DNR (1)
  • DUI (1)
  • Employer Rights (24)
  • Employment Law (26)
  • Estate Planning (5)
  • Family Law (3)
  • Firm News (31)
  • Healthcare Providers (1)
  • Immigration (1)
  • Injuries (1)
  • IRAs (1)
  • Life Insurance (1)
  • Paid Leave (2)
  • Personal Injury (5)
  • Premarital Agreements (1)
  • Prenuptial Agreements (1)
  • The North Dakota Employer's Blog (10)
  • Uncategorized (59)
  • Unemployment Insurance (1)
  • Wrongful Death (2)

Archives

  • February 2021 (4)
  • January 2021 (6)
  • December 2020 (5)
  • October 2020 (1)
  • September 2020 (1)
  • August 2020 (2)
  • July 2020 (2)
  • June 2020 (4)
  • May 2020 (9)
  • April 2020 (12)
  • March 2020 (12)
  • February 2020 (11)
  • January 2020 (2)
  • November 2019 (2)
  • September 2019 (1)
  • August 2019 (3)
  • July 2019 (2)
  • June 2019 (3)
  • May 2019 (2)
  • March 2019 (1)
  • January 2019 (1)
  • December 2018 (1)
  • November 2018 (1)
  • October 2018 (2)
  • September 2018 (2)
  • August 2018 (3)
  • July 2018 (2)
  • June 2018 (4)
  • March 2018 (1)
  • January 2018 (3)
  • October 2017 (1)
  • September 2017 (1)
  • June 2017 (4)
  • March 2017 (1)
  • January 2017 (1)
  • December 2016 (2)
  • October 2016 (2)
  • September 2016 (1)
  • June 2016 (1)
  • May 2016 (5)
  • April 2016 (1)
  • March 2016 (1)
  • February 2016 (2)
  • January 2016 (3)
  • December 2015 (1)
  • November 2015 (1)
  • October 2015 (1)
  • September 2015 (2)
  • July 2015 (1)
  • June 2015 (2)
  • April 2015 (1)
  • January 2015 (1)
  • December 2014 (1)
  • October 2014 (1)
  • August 2014 (1)
  • June 2014 (1)
  • May 2014 (1)
  • October 2013 (1)
  • June 2013 (2)
  • May 2013 (2)
  • January 2013 (1)
  • December 2012 (1)
  • November 2012 (2)
  • October 2012 (1)
  • February 2012 (1)

Recent Posts

  • COVID-19 Immunity Protections and Limitations: A Healthcare Provider’s Guide
  • The North Dakota Employer’s Blog: Fargo Mask Mandate and Employer Immunity from COVID-19 Related Civil Liability
  • The North Dakota Employer’s Blog: Another Update from the North Dakota Legislature
  • The North Dakota Employer’s Blog: A Legislative Update
  • The North Dakota Employer’s Blog: Enacting Mandatory COVID Vaccine Policies
Bg SubscribeSubscribe To This Blog's FeedFindLaw Network

Quality Attorneys. Quality Care.

Ultimately, we measure our success in terms of how we improve the lives of our clients.
We never forget that the most important part in any legal matter is the people involved.

Experience The Vogel Law Firm Difference

Quality legal service starts with contacting Vogel Law Firm. Call 866-771-9930 or submit the form to request a consultation.

Email Us For A Response

Experience The Vogel Law Firm Difference

Quality legal service starts with contacting Vogel Law Firm. Call 866-771-9930 or submit the form to request a consultation.

ECN | Employers Counsel Network
Fellow Litigation Counsel of America
Super Lawyers
Super Lawyers
Multi-Million Dollar Advocates Forum
Multi-Million Dollar Advocates Forum
Listed In Best Lawyers | The World's Premier Guide
ALFA International | The Global Legal Network

Fargo Office

Phone: 866-771-9930

Fax: 701-356-6395

218 NP Avenue
Fargo, ND 58102
Fargo Law Office Map

Bismarck Office

Phone: 701-214-4393

Fax: 701-258-9705
200 North 3rd Street,
Suite 201
Bismarck, ND 58501
Bismarck Law Office Map

Moorhead Office

Phone: 218-979-4994

Fax: 218-236-9873
215 30th Street North
Moorhead, MN 56560
Moorhead Law Office Map

Minneapolis Office

Phone: 952-236-4947

Fax: 952-898-4070
7300 West 147th Street,
Suite 304
Apple Valley, MN 55124
Apple Valley Law Office Map

Grand Forks Office

Phone: 701-203-4156

Fax: 701-864-2748
2825 36th Avenue South,
Suite A
Grand Forks, ND 58201
Grand Forks Law Office Map
  • Follow
  • Follow
  • Follow
Review Us
Employee Email

© 2021 Vogel Law Firm. All Rights Reserved.

Disclaimer | Site Map | Privacy Policy | Business Development Solutions by FindLaw, part of Thomson Reuters