Extended Relief for Employer Leave-Based Donation Programs
IRS has extended tax relief for calendar year 2021 for employers whose employees forgo sick, vacation or personal leave because of COVID-19.
provides that cash payments employers make to charitable organizations that provide relief to victims of COVID-19, in exchange for sick, vacation or personal leave which their employees forgo, will not be treated as compensation. Similarly, employees will not be treated as receiving the value of the leave as income and cannot claim a deduction for the leave that they donated to their employer.
Employers may deduct these cash payments as a business expense or as a charitable contribution deduction, if the employer meets certain requirements. Learn more here