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CAA Relief Bill: Tax Credits for Paid Leave May be Extended to March 31, 2021.

Dec 30, 2020 | Human Resources

CAA Relief what employers should know

On December 27, President Trump signed the Consolidated Appropriations Act of 2021 (CAA).  This bill means the federal Emergency Paid Sick Leave (EPSL) and Emergency Family and Medical Leave (EFMLA) may voluntarily be extended by the employer.

Here’s what employers need to know:

  • Offering EPSL and EFMLA after December 31 will become optional for employers.
  • An employee will no longer be entitled by law to take EPSL or EFMLA, even if they have a qualifying reason.
  • Employers who choose to offer these paid leaves can still receive a tax credit if they follow the current EPSL and EFMLA rules, including job protection.
  • The extension of the tax credit will be available for leaves taken through March 31, 2021.
  • Employees will not get new hours to use—the unused portion of their original allotment that remains on January 1 is how much they will be able to use through March 31.  For instance, if an employee who was entitled to 80 hours of EPSL between April 1 and December 31 used 40 of those hours in 2020, they’d have 40 hours left to use between January 1 and March 31, 2021.

The new law also extends or revives several other benefits from previous coronavirus-related legislation, some of which are listed below.  Certain aspects of the law are outside the scope of our services, so we are unable to answer follow-up questions on those topics.   Some of the notable provisions include:

  • Several changes to the Employee Retention were passed. Changes range from increasing the allowable credit per employee, extending this credit to PPP borrowers, and extension of credit through July 1, 2021.
  • Extension of Employee deferred payroll taxes.  The provision extends the employer’s repayment period through December 31, 2021. Penalties and interest on deferred unpaid tax liability will not begin to accrue until January 1, 2022.
  • Individual payments for people with incomes at or below $75,000 and additional payment per dependent child.  Payments will phase out for higher incomes
  • A $300 weekly supplemental unemployment benefit, through March 14, 2021
  • Extension of Pandemic Unemployment Assistance (for gig workers and the self-employed) and Pandemic Emergency Unemployment Compensation (for those who run out of state unemployment insurance benefits), through March 14, 2021
  • Reopening and refunding of the Paycheck Protection Program (see your financial or tax advisor for additional information)

There are many resources related to EPSL and EFMLA available in the HR Support Center.

This post is provided by the HR Pros at the HR Support Center and Corporate Payroll Services.  It is for informational purposes only and is not to be considered legal advice.  When you need essential information on human resources issues, from benefits, hiring, and management, to culture, technology and regulations, HR Support Center is a resource on which you can rely.  To learn more, visit www.corpay.com/hrsupport or contact us at 770-446-7289 x2102.