Breaking News:

Update on Payroll Tax Credit

For Affected Employers and Employees (who haven't been laid off)

If you are paying Sick or Child Care Leave Pay to Employees due to Coronavirus, please read below on available tax credits that may help cover some of those costs. See below on how to designate wages as Sick Pay.

UPDATE:
Rules Below Apply to Wages Paid on April 1st, 2020 through Dec 31st, 2020

DEPARTMENT OF LABOR DETAILS AND FAQ

Click above for answers to many questions!

Update on Applicable Effective Date

DOL clarified that these rules apply to wages beginning April 1, 2020. It is mandatory for emloyers with less than 500 employees unless you have < 50 employees and paying wages would cause catastrophic burden*.

What if we already laid off staff?

If you've already laid off employees before March 31st, then these rules would not apply to those former employees, but if you keep staff on, please note rules on mandatory Sick Leave Pay and Child Care Leave Pay*.

*Employers with fewer than 50 employees are eligible for an exemption from the requirements to provide leave to care for a child whose school is closed, or child care is unavailable in cases where the viability of the business is threatened. (BUT THEY HAVEN'T CLARIFIED IF/HOW TO PROVE THIS!--MJF)

TRACK SICK PAY HOURS IN PAYROLL SYSTEM
In Intuit's payroll system, click on Employee Tab and then click on affected employee's name and then Edit "Time Off" section to create a Sick Pay plan with their 80 available hours. Use that to allocate earnings on their paycheck rather than normal hours/salaries. We want to show differentiation on pay stubs so we can request Tax Credits later! We're not sure if this is required, but it's best practice along with ALSO keeping spreadsheets/lists/details and emails to prove that employees were NOT working due to coronavirus.

CREATE NEW CHILD CARE LEAVE PAY
If you choose to pay at lower 2/3 of normal pay rate for the Child Care Leave Pay, you will need to create a new Pay Type for each affected employee. For hourly, you can create a different hourly rate. For salary, create an Other Pay box called Child Care Leave Pay and then manually enter gross pay for each pay period.

Maximum Paid Sick Leave Credit

For an employee who is unable to work because of Coronavirus quarantine or self-quarantine or has Coronavirus symptoms and is seeking a medical diagnosis, eligible employers may receive a refundable sick leave credit for sick leave at the employee's regular rate of pay, up to $511 per day and $5,110 in the aggregate, for a total of 10 days (80 hours).

Child Care Leave Credit

In addition to the sick leave credit, for an employee who is unable to work because of a need to care for a child whose school or child care facility is closed or whose child care provider is unavailable due to the Coronavirus, eligible employers may receive a refundable child care leave credit. This credit is equal to two-thirds of the employee's regular pay, capped at $200 per day or $10,000 in the aggregate. Up to 10 weeks of qualifying leave can be counted towards the child care leave credit. Eligible employers are entitled to an additional tax credit determined based on costs to maintain health insurance coverage for the eligible employee during the leave period.

FOX TAX NEWSLETTER ARCHIVE

Click above for ALL of our most recent emails newsletters. We're doing our best to keep you informed, file as many tax returns as possible AND field your personal questions while working in isolation from our entire support staff. We are very grateful for your patience and support in the next few weeks before the April 15th deadline.