Internal Revenue Code · 26 U.S.C.
§ 3132. Payroll credit for paid family leave
Official text, no changes From the Office of the Law Revision Counsel, release point 119-121 (current through Public Law 119-121 (October 9, 2026)). Compare it with the official text at uscode.house.gov (external site).
Cite as 26 U.S.C. § 3132
At a glance
Read from the text, the source credit and the official notes. Not part of the law.
- Status
- In force
- Added
- March 11, 2021 by Pub. L. 117–2
- Length
- 10 subsections · 2,194 words · about 10 min to read
- Defines
- 6 terms
- Cross-references
- cites 19; cited by 4 Code sections and 0 other regulations
- Regulations
- 1 issued under this section
In the case of an employer, there shall be allowed as a credit against applicable employment taxes for each calendar quarter an amount equal to 100 percent of the qualified family leave wages paid by such employer with respect to such calendar quarter.
The credit allowed by subsection (a) with respect to any calendar quarter shall not exceed the applicable employment taxes for such calendar quarter (reduced by any credits allowed under section 3131) on the wages paid with respect to the employment of all employees of the employer.
If the amount of the credit under subsection (a) exceeds the limitation of paragraph (2) for any calendar quarter, such excess shall be treated as an overpayment that shall be refunded under sections 6402(a) and 6413(b).
In anticipation of the credit, including the refundable portion under subparagraph (A), the credit shall be advanced, according to forms and instructions provided by the Secretary, up to an amount calculated under subsection (a), subject to the limits under paragraph (1) and (2), all calculated through the end of the most recent payroll period in the quarter.
For purposes of this section, the term “qualified family leave wages” means wages paid by an employer which would be required to be paid by reason of the Emergency Family and Medical Leave Expansion Act (including the amendments made by such Act) as if such Act (and amendments made by such Act) applied after March 31, 2021.
For purposes of determining whether wages would be required to be paid under paragraph (1), if an employer fails to comply with any requirement of the Family and Medical Leave Act of 1993 or the Emergency Family and Medical Leave Expansion Act (determined without regard to any time limitation under section 102(a)(1)(F) of the Family and Medical Leave Act of 1994) 11 So in original. Probably should be “1993)”. with respect to any leave provided for a qualifying need related to a public health emergency (as defined in section 110 of such Act, applied as described in subparagraph (A)(i)), amounts paid by such employer with respect to such leave shall not be taken into account as qualified family leave wages. For purposes of the preceding sentence, an employer which takes an action described in section 105 of the Family and Medical Leave Act of 1993 shall be treated as failing to meet a requirement of such Act.
For purposes of this subsection, the term “qualified health plan expenses” means amounts paid or incurred by the employer to provide and maintain a group health plan (as defined in section 5000(b)(1)), but only to the extent that such amounts are excluded from the gross income of employees by reason of section 106(a).
For purposes of this section, qualified health plan expenses shall be allocated to qualified family leave wages in such manner as the Secretary may prescribe. Except as otherwise provided by the Secretary, such allocation shall be treated as properly made if made on the basis of being pro rata among covered employees and pro rata on the basis of periods of coverage (relative to the time periods of leave to which such wages relate).
The term “collectively bargained defined benefit pension plan contributions” has the meaning given such term under section 3131(e)(2).
The term “collectively bargained apprenticeship program contributions” has the meaning given such term under section 3131(e)(3).
For purposes of this section, the term “wages” means wages (as defined in section 3121(a), determined without regard to paragraphs (1) through (22) of section 3121(b)) and compensation (as defined in section 3231(e), determined without regard to the sentence in paragraph (1) thereof which begins “Such term does not include remuneration”).
For purposes of chapter 1, the gross income of the employer, for the taxable year which includes the last day of any calendar quarter with respect to which a credit is allowed under this section, shall be increased by the amount of such credit. Any wages taken into account in determining the credit allowed under this section shall not be taken into account for purposes of determining the credit allowed under sections 45A, 45P, 45S, 51, 3131, and 3134. In the case of any credit allowed under section 2301 of the CARES Act or section 41 with respect to wages taken into account under this section, the credit allowed under this section shall be reduced by the portion of the credit allowed under such section 2301 or section 41 which is attributable to such wages.
This section shall not apply to so much of the qualified family leave wages paid by an eligible employer as such employer elects (at such time and in such manner as the Secretary may prescribe) to not take into account for purposes of this section.
No credit shall be allowed under this section to the Government of the United States or to any agency or instrumentality thereof. The preceding sentence shall not apply to any organization described in section 501(c)(1) and exempt from tax under section 501(a).
This section shall apply only to wages paid with respect to the period beginning on April 1, 2021, and ending on September 30, 2021.
The Secretary shall waive any penalty under section 6656 for any failure to make a deposit of applicable employment taxes if the Secretary determines that such failure was due to the anticipation of the credit allowed under this section.
No credit shall be allowed under this section to any employer for any calendar quarter if such employer, with respect to the availability of the provision of qualified family leave wages to which this section otherwise applies for such calendar quarter, discriminates in favor of highly compensated employees (within the meaning of section 414(q)), full-time employees, or employees on the basis of employment tenure with such employer.
(Added Pub. L. 117–2, title IX, § 9641(a), Mar. 11, 2021, 135 Stat. 166.)
Terms defined here
Where the text says “the term … means”. Select a term to jump to its definition.
Regulations under this section
Treasury regulations (26 CFR) issued under § 3132
Cross-references
Computed from the citations in the text of Title 26 and 26 CFR.
This section cites 19 other sections
- § 3131 Credit for paid sick leave
- § 6402(a) Authority to make credits or refunds
- § 6413(b) Special rules applicable to certain employment taxes
- § 5000(b)(1) Certain group health plans
- § 106(a) Contributions by employer to accident and health plans
- § 3111(b) Rate of tax
- § 3221(a) Rate of tax
- § 3121(a) Definitions
- § 3231(e) Definitions
- § 45A Indian employment credit
- § 45P Employer wage credit for employees who are active duty members of the uniformed services
- § 45S Employer credit for paid family and medical leave
- § 51 Amount of credit
- § 3134 Employee retention credit for employers subject to closure due to COVID–19
- § 41 Credit for increasing research activities
- § 501(c)(1) Exemption from tax on corporations, certain trusts, etc.
- § 6501 Limitations on assessment and collection
- § 6656 Failure to make deposit of taxes
- § 414(q) Definitions and special rules
Cited by 4 Code sections
Amendment history
From the source credit and the official notes, newest first.
- Added by Pub. L. 117–2
Where it sits in the Code
Nearby sections
- § 3131 Credit for paid sick leave
- § 3132 Payroll credit for paid family leave
- § 3133 Special rule related to tax on employers
- § 3134 Employee retention credit for employers subject to closure due to COVID–19
Official notes
Show the Law Revision Counsel's notes (amendments, effective dates)
Editorial Notes
References in Text
The Emergency Family and Medical Leave Expansion Act and such Act, referred to in subsecs. (c)(1), (2)(B) and (g)(5), is div. C of Pub. L. 116–127, Mar. 18, 2020, 134 Stat. 189. For complete classification of this Act to the Code, see Short Title of 2020 Amendment note set out under section 2601 of Title 29, Labor, and Tables.
The Family and Medical Leave Act of 1993 and such Act, referred to in subsec. (c)(2), is Pub. L. 103–3, Feb. 5, 1993, 107 Stat. 6, which enacted chapter 28 (§ 2601 et seq.) of Title 29, Labor, sections 60m and 60n of Title 2, The Congress, and sections 6381 to 6387 of Title 5, Government Organization and Employees, amended section 2105 of Title 5, and enacted provisions set out as notes under section 2601 of Title 29. Sections 102, 105, and 110 of the Act are classified to sections 2612, 2615, and 2620, respectively, of Title 29. For complete classification of this Act to the Code, see Short Title note set out under section 2601 of Title 29 and Tables.
Section 5102(a) of the Families First Coronavirus Response Act, referred to in subsec. (c)(2)(A)(i), is section 5102(a) of Pub. L. 116–127, which is set out in a note under section 2601 of Title 29, Labor.
Section 2301 of the CARES Act, referred to in subsec. (f)(3), is section 2301 of title II of div. A of Pub. L. 116–136, which is set out as a note under section 3111 of this title.
Section 7 of the Small Business Act, referred to in subsec. (f)(7)(A)(i), (B), is classified to section 636 of Title 15, Commerce and Trade.
Section 7A of the Small Business Act, referred to in subsec. (f)(7)(A)(i), (B), is classified to section 636m of Title 15, Commerce and Trade.
Section 324 of the Economic Aid to Hard-Hit Small Businesses, Non-Profits, and Venues Act, referred to in subsec. (f)(7)(A)(ii), is classified to section 9009a of Title 15, Commerce and Trade.
Section 5003 of the American Rescue Plan Act of 2021, referred to in subsec. (f)(7)(A)(iii), is classified to section 9009c of Title 15, Commerce and Trade.
Statutory Notes and Related Subsidiaries
Effective Date
Section applicable to amounts paid with respect to calendar quarters beginning after Mar. 31, 2021, see section 9641(d) of Pub. L. 117–2, set out as a note under secton 3131 of this title.