What is the Sick & Family Leave Tax Credit?
The Sick and Family Leave Tax Credit for self-employed and 1099 workers is for eligible self-employed individuals or independent contractors. Under the FFCRA, eligible self-employed individuals or independent contractors could claim a 100% of the refundable tax credit against their income tax liability for up to qualified sick and family leave equivalent amounts, subject to certain limitations if they were unable to work or telework due to COVID-19-related reasons. The qualified sick leave equivalent helps compensate for each day an individual was unable to work or telework because they were subject to a quarantine or isolation order, had COVID-19 symptoms and were seeking a medical diagnosis, or were caring for someone who was subject to a quarantine or isolation order or who had COVID-19 symptoms. The qualified family leave equivalent helps compensate individuals who were unable to work or telework because they needed to care for a child whose school or place of care was closed due to COVID-19.
What documentation do I need to provide?
For the most part, we only require your 2019, 2020, and 2021 tax returns, including your Schedule C. *In some cases additional supplementary documents may be required.
How much are your processing fees?
You can get an estimate of potential credit amount without any upfront cost or obligation to use our credit estimator. Once our tax professionals determines the exact amount you are eligible for you can either pay a flat fee and file yourself. If you would like our tax professionals to file on your behalf, we have a flat fee including audit protection and our tax professionals will file your claim within 48-72 hours
Do I have to fill out a ton of paperwork?
Not at all. Complete the questionnaire and upload a copy of your 2019, 2020, and 2021 tax returns. We try to make the process as easy and stress-free as possible. Once we have your tax returns, you can either receive the calculation or our tax professionals can amend your 2020 and 2021 tax returns and file for you with audit protection.
Do I have to be self-employed to file for the tax credit refund?
Yes. This tax credit is only for self-employed individuals, small business owners, freelancers, and 1099 contractors.
How much of a tax credit can I expect to receive?
A few factors go into calculating your tax credit refund amount. The most significant factors would be: Your net income from your Schedule C on your 2019, 2020, and 2021 tax returns. How many days you were out sick or told to quarantine with Covid-19 How long you might have cared for a loved one affected by Covid-19. How long were schools or daycare centers closed (and you were forced to care for a minor child during the closings). But the fastest and easiest way to find out how much you could qualify for is to simply use our online calculator
How long before I will receive my cash refund?
Once we receive the necessary paperwork from you, we will begin to work on your case immediately and get all the forms filed; then, it is up to the IRS to send your refund directly to you. For the most part, we find that it usually takes 12–16 weeks to complete the process and receive your cash refund.
If the taxpayer and spouse both have self-employed income, can they both get the
Self-Employed Tax Credit (SETC)?
Yes. They can both get the credit but they cannot share qualifying COVID days.
If the taxpayer and spouse both have self-employed income, can they both get the max $32,220, if they each qualified for the max?
Yes. They can both get the max credit but again, they cannot share qualifying COVID days.
How do I qualify for the SETC tax credits?
To qualify for the SETC you will need to meet the below criteria:
Having a self employed business being structured as a single-member LLC, Sole proprietorship or 1099 contractor or freelancer
File an SE 1040 tax form for 2019, 2020 and 2021 all showing a positive net income.
Have missed work days due to Covid-19.
What are the reasons I may qualify for SETC tax credits
If you have a business that is a 1099, Single owner LLC, or sole proprietorship and have missed work due to one or more of the covid related issues below, you may be eligible for the SETC program:
-A government order imposed a quarantine or isolation
-You were having symptoms related to Covid-19 while also waiting for an appointment with your doctor.
-You were waiting for test results related to COVID-19.
-You were getting a Covid-19 Vaccination
-You were experiencing side effects from the COVID-19 vaccine
-Your doctor recommended you self-quarantine.
Can I still receive the SETC if I have already filed my 2020 and 2021 Taxes?
Yes you can receive the SETC credit, but our tax professionals will have to amend both 2020 and 2021 of your tax returns. The only thing our firm will require is copies of the 2019,2020 and 2021 taxes.
Why have I never heard of SETC before?
At first, the SETC program was designed to originally focus on W-2 employees. Even though the CARES Act was later passed that same year with the self employed in-mind, THE SETC tax credit was never widely publicized. There are over 80% of self employed individuals unaware of the SETC program.
Will I be taxed on my SETC credits?
No, you will not be taxed on the SETC credits you receive.
Is SETC a Loan?
SETC is NOT a loan or a grant, but instead a credit on taxes that the individual has already paid. The credits compensate you if you were sick or were caring for someone which prevented you from working due to covid-19.
Can I claim Weekends for the SETC Credits?
Yes, you can claim weekends if you typically work on the weekends and missed these work days due to covid-19.
How is SETC different from the PPP program?
Although the SETC (Families First Coronavirus Response Act) and the PPP (Paycheck Protection Program) are two completely different economic recovery programs, they were both designed to lessen the economic impact of the COVID-19 pandemic. The PPP provided LOANS to small businesses with the added potential for loan forgiveness. SETC is NOT a loan but a credit on taxes that individuals have already paid. The PPP loan was designed to help businesses while the SETC program was focused on helping the individual.
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