In the U.S., the COVID-related tax relief act of 2021 is the result of congressional action on COVID. Passed into law in December of 2020, COVIDTRA extends many provisions of the $2.2 trillion CARES Act, which helped fight the pandemic that killed millions of people. COVID victims can now receive tax relief through COVID-related incentives.
The new COVID-related tax relief act of 2020 provides some additional financial assistance for those affected by the disease. The act expands the employment tax moratorium and provides employee retention tax credits. It also extends the payback period for the employment tax moratorium to December 2021. The COVID-related tax relief act of 2021 will require the IRS to issue regulations defining what supplies qualify as an above-line educator expense.
In addition to extending the COVID-19 emergency relief, the COVID-related tax relief act of 2021 has extended the Earned Income Tax Credit to qualified wages paid after March 12, 2020. However, it also extends the period of COVID-19 emergency relief until June 30, 2021. Further, the COVID-19-Related Tax Relief Act of 2021 provides additional guidance for employers, including the ability to exclude COVID-19-related relief from gross receipts.
The COVID-related tax relief act of 2021 makes it easier for taxpayers to claim benefits if they have incurred medical bills. The legislation provides tax credits for employees who have been off work due to the illness and their family’s financial obligations. It also provides relief for self-employed individuals who need to take time off from work to take care of their health. In addition to providing financial assistance, the COVID-related tax relief act of 2021 also provides additional protections for individuals who are affected by the virus.