What Is The FFCRA Tax Credit — Families First Coronavirus Response Act?

Get a tax refund for your sick days.



If you missed work due to COVID-19 related reasons, the government wants to pay you back—even if you were self-employed. You may be eligible for a tax credit from the Internal Revenue Service (IRS)—and this credit is available now, retroactively, for lost income/work in 2020 and 2021. 



The Family First Coronavirus Response Act, also called FFCRA, was signed into law in March 2020, and among other things, addressed paid sick leave and unemployment benefits. One of the many benefits of the FFCRA was that it provided tax credits to eligible self-employed individuals — including 1099 and gig workers— for sick days and family leave related to the COVID-19 pandemic. 



This tax credit is different from a deductible, as it directly reduces the total tax owed to the IRS. You can apply for this credit retroactively for 2020 and 2021, which means you could still receive a check in the mail if you haven’t already claimed it.





Find out if you qualify for the FFCRA tax credit







What is the FFCRA tax credit for self-employed individuals? The FFCRA is widely known among employers with W-2 employees, as they can provide paid time off or sick leave to their workers based on specific circumstances outlined in the following section. However, many self-employed individuals, such as 1099 contractors or consultants, may not be aware that they are also eligible for this COVID-19 tax credit, and it can be applied retroactively.



How does FFCRA work? The FFCRA is a tax credit that allows employers to get reimbursed for time you weren’t able to work due to the effects of COVID-19. Here are some of the reasons you could qualify. They don’t all have to apply to you, but if one or more of these things happened to you, you are likely eligible. You should apply if missed work because you were:




Following a federal, state, or local quarantine or isolation order



Advised by a healthcare provider to self-quarantine



Experiencing coronavirus symptoms and were seeking a medical diagnosis



Caring for a child or other individual, who was subject to a government-issued or self-quarantine restriction, as described in #2



Caring for a child whose school or daycare was closed or unavailable



Obtaining a COVID-19 vaccination



Recovering from illness related to the COVID-19 vaccine



Seeking or waiting for the results from a  COVID-19 test




Note: Criteria 6-8 only apply from April 1, 2021, through September 30, 2021. 



If you were an employee on the W2 form in 2020 or 2021, your employer might have already claimed the maximum credit, making you ineligible. However, if you were both self-employed and a W2 employee, you could qualify for a tax credit under FFCRA, provided your employer didn’t already claim the maximum FFCRA tax credit.



How much money will I get from the FFCRA as a 1099 contractor or self-employed individual? If eligible, you can receive up to a maximum of $32,220 in tax credits, which consists of:



For the period of April 1, 2020, through March 31, 2021:




10 days of emergency paid sick/family/medical leave

Taking care of yourself: Claim the lower of either your average daily self-employment earnings or $511 per day



Taking care of someone else: Claim the lower of either 67% of your average daily self-employment earnings or $200 per day





50 days of emergency paid sick/family/medical leave

Daycare or school closure: Claim the lower of either 67% of your average daily self-employment earnings or $200 per day 






For the time period of April 1, 2021 – September 30, 2021, you may receive an additional 10 days of paid sick leave and 60 days of family leave. 



How do I apply for the FFCRA credit? To apply for the FFCRA, follow these simple steps:




Step 1: Visit our application portal .



Step 2: Confirm your eligibility. There’s no fee or obligation to find out how much you qualify for.



Step 3: Submit your application. Don’t worry, there’s no need to upload any tax documents—our streamlined process will calculate numbers and accurately complete all documents.



Step 4: See how much you qualify for.



Step 5: Submit payment and receive funding.




How will I receive my COVID-19 FFCRA credit? You will receive the lump sum directly from the IRS via check or an ACH transfer to your desired account.







Information provided on this blog is for educational purposes only , and is not intended to be business, legal, tax, or accounting advice. The views and opinions expressed in this blog are those of the authors and do not necessarily reflect the official policy or position of Lendio. While Lendio strivers to keep its content up to-date, it is only accurate as of the date posted. Offers or trends may expire, or may no longer be relevant.



The post What Is The FFCRA Tax Credit — Families First Coronavirus Response Act? appeared first on Lendio .