9/7/2021
The Treasury Department and the Internal Revenue Service issued Notice 2021-53, which provides guidance to employers about reporting the amount of qualified sick and family leave wages paid to employees for leave taken in 2021 on Form W-2 under recent legislation, including the Families First Coronavirus Response Act (FFCRA) amended by the COVID-Related Tax Relief Act of 2020, and the American Rescue Plan Act of 2021.
Employers will be required to report these amounts to employees either on Form W-2, Box 14, or in a separate statement provided with the Form W-2. The guidance provides employers with model language to use as part of the Instructions for Employee for Form W-2 or on the separate statement provided with Form W-2.
The wage amount the notice requires employers to report on Form W-2 will give employees who are also self-employed with the necessary information to determine the amount of any sick and family leave equivalent credits they can claim in their self-employed capacities.
The IRS issued Notice 2020-54 In July 2020 providing guidance for W-2 reporting of qualified sick leave and family leave under FFCRA for wages paid to employees for leave taken in 2020.
Resources:
Employer Tax Credits - information about tax relief for employers affected by the COVID-19 pandemic