FAMILIES FIRST CORONAVIRUS RESPONSE ACT
The Families First Coronavirus Response Act (FFA) was approved by the Senate on March 18, 2020, and swiftly signed by the President into law.
While the FFA contains tax provisions, the primary goal was to ensure affected individuals receive paid leave, food assistance and unemployment insurance during this unprecedented time.
SUMMARY OF FFA
Emergency Family Leave and Medical Leave Expansion
The FFA expands the existing Family and Medical Leave Act (FMLA) to specifically address COVID-19 by creating an emergency paid leave program available through 12/31/2020.
Emergency Paid Sick Leave
Private sector employers with fewer than 500 employees, and all government entities, must provide employees unable to work with immediate paid sick time to:
Full-time employees receive 80 hours (8 hours/day for 10 days) while part-time employees receive time off equivalent to their normal two-week schedule. This paid sick time is a ‘use it’ or ‘lose it’ and is not eligible for carryover from year-to-year.
Employer Payroll Tax Credits
To offset the cost associated with the emergency family & sick leave programs, new refundable tax credits were created. The refundable credits under the FFA offset the employers’ portion of Social Security taxes. The credits generally equal the required payments for each program including the applicable payment caps per employee.
Self-Employed Tax Credit
If you are self-employed, the FFA provides similar family leave and paid sick leave tax credits.
IRS GUIDANCE AND RESOURCES
TAX WARRIOR BLOGS & ALERTS
March 19, 2020 - Families First Coronavirus Response Act Enacted
THIRD PARTY RESOURCES
House Committee on Ways & Means - FAQ: Coronavirus Legislation provides additional insight into the intent of coronavirus legislation, including the Families First Act, and how it may affect your business.