COVID-19 Tax Credits For The Self-Employed
Recently enacted legislation provides tax credits for Sick Leave and Family Leave for certain self-employed individuals. The new law provides a tax credit for Sick Leave for eligible self-employed individuals who were unable to perform services during the period April 1, 2020, and December 31, 2020, due to certain COVID-19 related reasons. The credit is based on net earnings from self-employment and is limited to $511 per day for a maximum of 10 sick days.
The law also provides a tax credit for Family Leave for eligible self-employed individuals who were unable to perform services during the period April 1, 2020, and December 31, 2020, due to certain COVID-19 related care provided to a son or daughter. This credit is based on net earnings from self-employment and is limited to $200 per day for a maximum of 50 care days.
The end date for these tax credits has now been extended to March 31, 2021.
For details regarding these tax credits, see IRS Form 7202 and the instructions for Form 7202 below.
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The information provided herein is for educational purposes only and should not be considered investment, tax, accounting, or legal advice. Winthrop Partners does not provide tax advice or legal advice. The information contained herein may also be subject to change. Winthrop Partners has made every attempt to ensure the accuracy and reliability of the information provided, but it cannot be guaranteed. Before taking any action, you should first consult with a tax or legal professional.
Thomas Bunting is a Financial Advisor at Winthrop Partners. He has more than 50 years of experience in accounting, financial planning, and tax planning. Prior to joining Winthrop Partners, Tom held the roles of partner, managing partner, and senior partner with a mid-sized CPA firm that provided a full range of accounting, tax and financial planning services.
Tom is a member of the American Institute of Certified Public Accountants, the Personal Financial Planning and tax sections of the American Institute of Certified Accountants, and the Pennsylvania Institute of Certified Public Accountants. He was also a former member of the AICPA governing council and a past president of the PICPA. He earned his BS in Accounting from Temple University.