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    Labor & Employment Law Daily Wrap Up, VITAL BRIEFING—Paid family and medical leave tax credit for employers will likely be expanded, extended, (Jun 26, 2025)

    By Karen Servidea, J.D.

    The House-passed and draft Senate reconciliation bills would make the credit permanent and allow employers to claim the credit for premiums paid for insurance that provides paid family and medical leave.

    Employers that provide paid family and medical ...

    By Karen Servidea, J.D.

    The House-passed and draft Senate reconciliation bills would make the credit permanent and allow employers to claim the credit for premiums paid for insurance that provides paid family and medical leave.

    Employers that provide paid family and medical leave (PFML) to employees likely will continue to benefit from a tax credit based on the amount of wages paid to employees during periods of leave. The tax credit, adopted as part of The Tax Cuts and Jobs Act of 2017, had been set to expire at the end of 2025. The One Big Beautiful Bill Act (H.R. 1) passed in May by the House of Representatives and the legislative text released in June by the Senate Finance Committee for inclusion in the Senate Republicans’ budget reconciliation bill would make the credit permanent, however. The purpose of the credit is to incentivize employers to provide PFML to their employees—something that federal law does not require. Both pieces of draft legislation also would amend other aspects of the credit.

    In this Vital Briefing, Karen Servidea provides an overview of the changes to the PFML credit being considered as part of the budget reconciliation process, including:

    • Making the credit, currently set to expire at year’s end, permanent.

    • Adding option to compute the credit based on premiums paid for paid family and medical leave insurance.

    • Allowing employers to claim the credit for employees employed for as little as six months.

    • Treating controlled group members as a single employer.

    • Making the credit available to employers in states with paid family and medical leave laws.

    To read the entire article, click here.

    MainStory: EmployeeLeave FederalLegislation PensionBenefitPlans

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