Page 393 - Small Business IRS Training Guides

The credit is a percentage of the amount of wages paid to a qualifying employee while on family and medical leave for up

to 12 weeks per taxable year.

An employer must reduce its deduction for wages or salaries paid or incurred by the amount determined as a credit. Any
wages considered in determining any other general business credit may not be used toward this credit.

The IRC 45S credit is first available for wages paid in tax years beginning after 2017 and expires for wages paid in tax

years beginning after 2019. Thus, the credit is available for calendar and fiscal tax years beginning in 2018 and 2019.

Identifying a Qualifying Program for the General Business Tax Credit

The following information can be used to identify whether the taxpayer provides a program for employee family and

medical leave that qualifies for the general business tax credit:

• Employer and employee interviews: Discussions with the employer and the employees would verify the

existence of a qualified family medical leave program.

• Employee Handbooks: Many taxpayers maintain a written employee handbook outlining the benefits available to
their employees.

• Employee Newsletters: Many taxpayers publish a newsletter for employees that include descriptions of the benefit
programs and any changes made.

• Employment Contracts: Benefits may be described in employment contracts with key personnel.

73233-102 13403-4 Tax Cuts and Jobs Act