FFCRA: tax credits, paid sick leave, economic injury disaster loans, and more Email
Written by Cherie Courtade   
Tuesday, April 07, 2020 03:00 AM

US CapitolThe first of three relief packages approved to date by Congress was HR 6201, Families First Coronavirus Response Act (FFCRA). It was passed on March 18 and took effect April 1, 2020. On April 3, the US Department of Labor (DOL) announced additional guidance regarding paid sick leave and expanded family and medical leave from the act.

The materials include:

DOL’s Employment & Training Administration has also issued a letter related to the act that provides instructions for implementing the law’s provisions: UNEMPLOYMENT INSURANCE PROGRAM LETTER No. 13-20 provides states with “instructions for implementing the Families First Coronavirus Response Act, Public Law (Pub. L.) 116-127, specifically Division D, the Emergency Unemployment Insurance Stabilization and Access Act of 2020 (EUISAA).”

Additional guidance and regulations can be found in the temporary rule regarding FFCRA implementation. 

A quick overview of the act’s key provisions:

  • Paid Sick Leave for Workers
    For COVID-19 related reasons, employees receive up to 80 hours of paid sick leave and expanded paid child care leave when employees’ children’s schools are closed or child care providers are unavailable.
  • Complete Coverage
    Employers receive 100% reimbursement for paid leave pursuant to the act.
    • Health insurance costs are also included in the credit.
    • Employers face no payroll tax liability.
    • Self-employed individuals receive an equivalent credit.
    • Fast Funds
      Reimbursement will be quick and easy to obtain.
      • An immediate dollar-for-dollar tax offset against payroll taxes will be provided
      • Where a refund is owed, the IRS will send the refund as quickly as possible.
      • Small Business Protection
        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.
      • Easing Compliance
        Requirements subject to a 30-day non-enforcement period for good faith compliance efforts.

Tax credits related to FFCRA
To take immediate advantage of the paid leave credits, businesses can retain and access funds that they would otherwise pay to the IRS in payroll taxes. If those amounts are not sufficient to cover the cost of paid leave, employers can seek an expedited advance from the IRS by submitting a streamlined claim form that will be released next week.

IRS explains that FFCRA “provides small and midsize employers refundable tax credits that reimburse them, dollar-for-dollar, for the cost of providing paid sick and family leave wages to their employees for leave related to COVID-19.” Learn more. Note that employers may not use the same wages to count for both the FFCRA refundable tax credit and the CARES Act employee retention credit. Read more IRS guidance on these tax credits.

Small Business Majority’s COVID-19 daily updates for small businesses: smallbusinessmajority.org/covid-19-daily-updates-for-small-businesses

Has your company applied for the Paycheck Protection Program (PPP) or an Economic Injury Disaster Loan (EIDL)? Tell us about your experience. 

Read more in this issue of Colorado Green NOW:
CARES Act resources for businesses
Landscape companies adapt amid the COVID-19 pandemic

Leading your business through the pandemic

Worksite safety is more important than ever