New Federal Paid-Leave Tax Credit

Updated: Aug 6, 2018

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New Federal Paid-Leave Tax Credit for Businesses

You could be eligible for the Federal Paid-Leave Tax Credit, a tax credit for employers who:

  1. Have a separate policy for family and medical leave outside any generic leave policy

  2. Offer your employees > two weeks of paid family medical leave (annually)

  3. Leave is paid at >50% of normal wages

What's the potential credit for me?

12.5% to 25% of the amount paid to the employee while on leave. The percentage used for the calculation increases based on how much of the employee's normal wage is paid while out on leave.

Can you give me an example? Let's say an employee who makes $65,000 annually takes 12 weeks of leave. Since you paid 100% of her wage while on leave, the you would receive $3,750 in credits. If 20 people take a similar amount of leave throughout the year, this could mean $75,000 in credits.

How do I qualify?

  • Employer Qualifications: Providing at least two weeks of paid family and medical leave to full-time employees AND Leave is paid at 50% of normal wages.

  • Employee Qualifications: <$72,000 in annual compensation the prior year AND Employed for >1 year.

  • Leave Reason: Birth of a child/care of a new born, Adoption/Foster placement of a child, or Caring for a military service member who is related.

HireCredit can help.

HireCredit can pre-determine estimated tax credits for you and file all the necessary paperwork. Making this process people-less and paper-less.


If you'd like to learn more or get started with HireCredit, contact or download our white paper here.


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