Tax Credits for Paid Leave Under the American Rescue Plan Act of 2021: Periods of Time for Which Credits are Available

 

Note: These FAQs address the tax credits available under the American Rescue Plan Act of 2021 (the "ARP") by employers with fewer than 500 employees and certain governmental employers without regard to the number of employees ("Eligible Employers") for qualified sick and family leave wages ("qualified leave wages") paid with respect to leave taken by employees beginning on April 1, 2021, through September 30, 2021, as well as the equivalent credits available for certain self-employed individuals. For information about the tax credits that may be claimed for qualified leave wages paid with respect to leave taken by employees prior to April 1, 2021, under the Families First Coronavirus Response Act ("FFCRA") and the COVID-related Tax Relief Act (the "Relief Act"), see Tax Credits for Paid Leave Under the Families First Coronavirus Response Act for Leave Prior to April 1, 2021 FAQs.

Although the requirement that Eligible Employers provide leave under the Emergency Paid Sick Leave Act ("EPSLA") and Emergency Family and Medical Leave Expansion Act ("Expanded FMLA") under the FFCRA does not apply after December 31, 2020, the tax credits under sections 3131 through 3133 of the Internal Revenue Code ("the Code") are available for qualified leave wages an Eligible Employer provides with respect to leave taken by employees beginning on April 1, 2021, through September 30, 2021, if the leave would have satisfied the requirements of the EPSLA and Expanded FMLA, as amended for purposes of the ARP.

Throughout these FAQs, the use of the word "work," unless otherwise noted, is inclusive of telework.

68. How long are the refundable tax credits for qualified leave wages available? (added June 11, 2021)

The credits for qualified leave wages paid under the ARP apply to qualified leave wages paid with respect to leave taken by employees beginning on April 1, 2021, through September 30, 2021.

For more information on requirements and eligibility related to paid sick and family leave between April 1, 2020 and December 31, 2020, see the DOL's Families First Coronavirus Response Act: Questions and Answers. For information on the tax credits available for qualified leave wages paid with respect to leave taken by employees prior to April 1, 2021, see

Tax Credits for Paid Leave Under the Families First Coronavirus Response Act for Leave Prior to April 1, 2021 FAQs.

69. Are wages paid after September 30, 2021, qualified leave wages for purposes of the credit if paid for leave taken before September 30, 2021? (added June 11, 2021)

Yes. Wages paid after September 30, 2021, may be qualified leave wages under the ARP so long as the wages are paid with respect to leave taken by employees beginning on April 1, 2021, through September 30, 2021.

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