New IRS Form Released for Self-employed to Claim Family Leave Credits

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The IRS has released Form 7202 “Credits for Sick Leave and Family Leave
for Certain Self-Employed Individuals”
to determine sick and family medical leave credit amounts for qualified self-employed individuals.

Eligibility for the sick and family leave credits

The Families First Coronavirus Response Act passed last March allows eligible self-employed individuals refundable tax credits if they were unable to work due to their own health problems or to care for a family member related to COVID-19.

In order to qualify for the credits, the individual must have self-employment income and be eligible to receive qualified sick and family leave wages as if the self-employed taxpayer were an employee under the Emergency Paid Sick Leave Act (EPSLA and maintain documentation establishing their eligibility.

How to claim your credit under the FFCRA

The credit for self-employed taxpayers under the FFCRA can be claimed on the individuals 2020 Form 1040 for leave taken between April 1st and December 31st of 2020 and on their 2021 Form 1040 for leave taken between January 1st and March 31st of 2021.

Instructions for the qualified sick leave amount and the qualified family leave amount can be found on the IRS website.

This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any transaction.

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