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To Enable More Vaccinations, Treasury Expands Paid Leave Tax Credit

WASHINGTON — Today the Treasury Department and the Internal Revenue Service announced that eligible employers can claim tax credits equal to the wages paid for providing paid time-off to employees to take a family or household member or certain other individuals to get vaccinated, or to care for a family or household member or certain other individuals recovering from the vaccination. Comparable tax credits are also available for self-employed individuals.   

In April, Treasury and the IRS announced eligible employers, such as businesses and tax-exempt organizations with fewer than 500 employees and certain governmental employers, could receive paid leave tax credits available under the American Rescue Plan Act of 2021 (ARP)  for providing leave for each employee receiving the vaccine and for any time needed to recover from the vaccine. Today’s expanded guidance gives employers further opportunity to support the health and safety of their employees’ families and communities without placing an undue burden on their business during the pandemic.

For more details on how the paid leave tax credits from the American Rescue Plan will work for employers to enable employees to take family and household members to receive and recover from after-effects of vaccination, as well as for other purposes, see the updated FAQs released by the IRS today.

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