Family Medical Leave Act Tax Credit Services
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Why Supporting Employees Matters
FMLA Tax Credit Background
The Family and Medical Leave Act Tax Credit was launched as part of the December 2017 Tax Cuts and Jobs Act. Beginning in 2018, employers can offset a percentage of the wages disbursed for paid FMLA leaves. After one year of employment, employees earning up to the designated earnings threshold can generate a tax credit for their employer.
Employee Eligibility and Timeline
For employees to qualify for the 2018 credit, their income must have been no more than $72,000 in 2017. Both full- and part-time employees can qualify. The credits has been extended to run through the end of 2020.
In order for employers to qualify for the tax credit, the business must have a documented FMLA paid leave policy. That policy must provide full-time workers with at least two weeks of paid leave each year. Part-time employees should receive pro-rated compensation according to the number of hours worked. The wages paid for this leave must not be less than 50% of normal wages.
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TCC delivers tax incentive and human resources technology-enabled services.
We specialize in solutions for the Work Opportunity Tax Credit (WOTC), income and employment verification, research & development tax credits, sales and use tax incentives and other federal and state tax incentives.