Eligible self-employed individuals will determine their qualified sick and family leave equivalent tax credits with the new IRS Form 7202, as an addendum to the 2020 Form 1040 for leave taken between April 1, 2020, and December 31, 2020, and the 2021 Form 1040 for leave taken between January 1, 2021, and March 31, 2021.
The FFCRA, passed in March 2020, allows eligible self-employed individuals who, due to COVID-19 are unable to work or telework for reasons relating to their own health or to care for a family member to claim refundable tax credits to offset their federal income tax. The credits are equal to either their qualified sick leave or family leave equivalent amount, depending on circumstances.
Eligible self-employed individuals must:
- Conduct a trade or business that qualifies as self-employment income, and
- Be eligible to receive qualified sick or family leave wages under the Emergency Paid Sick Leave Act or Emergency Family and Medical Leave Expansion Act as if the taxpayer was an employee.
Dunham Tax Professionals wants to again remind you that proper documentation is key in establishing eligibility for the credits as an eligible self-employed individual. We’re available and here to help you get everything you deserve. Schedule an appointment today.