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U.S. Small Businesses Offered Tax Credit to Offset Vaccine Costs

President Biden is urging all employers to offer paid time off for employees to receive or recover from the COVID-19 vaccine by offering a special tax credit to offset those costs.

Signed into law as part of the American Rescue Plan, the special tax credit will be offered to businesses with fewer than 500 employees.

In a statement, the White House says providing paid time off to receive or recover from the COVID-19 vaccine is “an investment in the safety, productivity and health of an employer’s own workforce and community.” Every U.S. citizen 16 or older is now eligible to be vaccinated.

Understanding the Tax Credit

Learn more about the new tax credit, as detailed by the White House:

As part of the American Rescue Plan, a paid leave tax credit will offset the cost for businesses and nonprofits with fewer than 500 employees for up to 80 hours (i.e. 10 work days) up to $511 per day of paid sick leave offered between April 1 and September 30, 2021.

This tax credit will allow these employers to provide paid leave for employees to get a COVID-19 vaccination and for any time their employees may need to recover from that vaccination at no cost to the employer.

This tax credit will apply to nearly half of all private sector employees in America. The Internal Revenue Service (IRS) released and posted a fact sheet to educate employers on how to claim the paid sick leave credit on their quarterly tax filings. For more details on how the paid leave tax credits from the American Rescue Plan will work for employers to enable employees to get vaccinated and recover from after-effects of vaccination, as well as for other purposes, please consult this snapshot from the Department of the Treasury.

About Todd Taber

Todd Taber
Todd is trends editor for Hardware Retailing magazine. He graduated from Indiana University where he majored in journalism and French. Throughout his career, he has aimed to highlight small businesses and their community value. He joined NRHA in 2017.

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