The Treasury Department and the Internal Revenue Service issued Notice 2021-53, which provides guidance to employers about reporting on Form W-2 the amount of qualified sick and family leave wages paid to employees for leave taken in 2021. The notice provides guidance under recent legislation, including: the Families First Coronavirus Response Act (FFCRA), as 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 for the Form W-2 or alternatively, on a separate statement provided with the Form W-2.
The wage amount that the notice requires employers to report on Form W-2 will provide employees who are also self-employed with the information necessary to determine the amount of any sick and family leave equivalent credits they may claim in their self-employed capacities.
In July 2020, the IRS issued Notice 2020-54, which provided guidance regarding W-2 reporting of qualified sick leave and family leave under FFCRA for wages paid to employees for leave taken in 2020.
For further details, visit:
Guidance on Reporting Qualified Sick Leave Wages and Qualified Family Leave Wages Paid for Leave Provided in 2021, IRS Notice 2021-53 (irs.gov)
Guidance on Reporting Qualified Sick Leave Wages and Qualified Family Leave Wages Paid Pursuant to the Families First Coronavirus Response Act, IRS Notice 2020-54
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