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There are two lesser known, but very important items in the latest government stimulus package, American Rescue Plan Act of 2021, and that is tax credits for having your employees receive paid time off to go and get the COVID vaccine and family leave. For the COVID vaccine tax credit, you will receive $511 per employee, per day, up to $5,110 so $5,000 per employee as a tax credit if you’ve given paid time off for your employees to go and get the COVID vaccine.
If you have employees that are gone and received the vaccine, make sure that you are keeping track of the time that they took off to go and get it.
If you have employees who have not gone to receive the vaccine yet, encourage them to do so and give them paid time off to go and get it.
By doing this, you could receive up to $5,000 off of your payroll taxes and the way you get it is by filing on your payroll taxes. If you’re self-employed, you’ll get it on your 1040 form at the end of the year.
There’s another, more hidden, benefit that a lot of people don’t know about and that is family leave.
If you’re giving your employees paid time off for family leave, you can get up to $200 per day.
These are two tax credits that most people are not taking advantage of. They can go against your payroll taxes and are an immediate reduction in your taxes. This can add up to as much as $5,000, $6,000 or $7,000 per employee.
Make sure you have good records, your accounting is in order and you’re taking advantage of these tax credits in order to increase the overall profitability of your business by paying less in payroll taxes.
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