Were You Self-Employed During Covid?
You may be eligible for up to $32,200 from the IRS.
We built the first-ever tool to help you get the federal FFCRA tax credits that you deserve – safely, quickly, and easily.
BEGIN YOUR SETC REGISTRATION
What Is SETC?
In March 2020, the Families First COVID-19 Response Act (FFCRA) was signed into law to help companies offer paid sick leave and unemployment benefits caused by COVID-19. The FFCRA initially focused on employers and their W-2 employees, helping weather the economic impact caused by the pandemic.
Come December 2020, Congress passed the CARES Act, which expanded FFCRA to cover not only employers, but the self-employed as well. Thanks to this expansion, self-employed individuals, freelancers, independent contractors, and gig workers are now eligible for the FFCRA. At Jorns, we refer to these FFCRA credits as Self Employment Tax Credits (SETC). The SETC pays individuals back for the time they would normally spend earning money that was lost because of COVID.
When applying for the SETC with Jorns, clients are filing for the qualified sick leave equivalent credit and the qualified family leave equivalent credit under the FFCRA.
Eligibility
Did you miss work due to:
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Federal, state, or local lockdown orders related to COVID-19
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Quarantining or isolation order related to COVID-19
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Symptoms of COVID-19 or seeking a medical diagnosis
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Sickness due to vaccination side effects
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Caring for your child whose school had closed or gone virtual
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Caring for your child because your child care provider was unavailable due to COVID-19
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Caring for someone with COVID symptoms
Filing, Easier than ever.
Filing with the IRS can be challenging, complex, and time-consuming. You may wonder - Do I have the right paperwork? Are these calculations correct? How do I know if I’m approved?
It’s why Jorns & Associates is here, because working for yourself shouldn’t mean you’re on your own.
We’ll take care of preparing your tax returns to claim SETC so you can get back to doing what matters most; growing your business.
Frequently Asked Questions
General
SETC stands for Self-Employed Tax Credit. The SETC derived from the Families First COVID-19 Response Act (FFCRA). This provides a tax credit for individuals who are self-employed.
The SETC pays individuals back for the time they would normally spend earning money that was lost because of COVID.
The dates you can claim the SETC under FFCRA include;
● 2020: 4/1/2020 - 3/31/2021
- Up to 50 days for Dependent(s) School Closures
- Up to 10 days for Self Covid and or Caretaking
● 2021: 4/1/2021 - 9/30/2021
- Up to 60 days for Dependent(s) School Closures
- Up to 10 days for Self Covid and or Caretaking
SETC is not a loan or grant and it does not need to be repaid. SETC is a refundable tax credit. A refundable credit is a credit you get as a refund even if you do not owe any tax.
Qualifying
A self-employed person in the United States, as defined by the Internal Revenue Service, is generally considered someone to who the following applies;
- You carry on a trade or business as a sole proprietor or an independent contractor.
- You are a member of a partnership that carries on a trade or business.
- You are otherwise in business for yourself (including a part-time business or a gig worker).
Missing work due to:
- Federal, state, or local lockdown orders related to COVID-19
- Quarantining or isolation order related to COVID-19
- Symptoms of COVID-19 or seeking a medical diagnosis
- Sickness due to COVID vaccination side effects
Dependent(s) School Closures
- Caring for your child whose school had closed or gone virtual
- Caring for your child because your child care provider was unavailable due to COVID-19
- Symptoms of COVID-19 or seeking a medical diagnosis
- Sickness due to COVID vaccination side effects
Caretaking
- Caring for someone with COVID, other than a dependent or spouse
○ It is possible that you remain eligible to claim SETC provided you earned self-employment income alongside your W2 salary in 2020 and/or 2021.
Dependents
The IRS defines a dependent as either a qualifying child or relative of the taxpayer. The relative can be your child, stepchild, foster child, sibling, parent, grandparent, grandchild, aunt, uncle, niece, nephew, or certain in-law relationships. All dependents must be under 17.
If the physical school was closed due to COVID, this would be considered “closed” and eligible for the purposes of SETC under FFCRA.
Credit
Self Covid: This portion of the credit is calculated by multiplying the number of days on leave by whichever amount is smaller:
- Your average daily self-employment income*
- $511
Dependents & Caretaking: These portions of the credit is calculated by multiplying the number of days on leave by whichever amount is smaller:
- ⅔ of your average daily self-employment income*
- $200
*We will use line 6 of the Schedule SE on your personal tax return to determine your annual pay, divided by 260 (Considered the standard amount of working days in a year) to calculate your daily rate.
- It can take up to three weeks for the IRS to acknowledge the acceptance of your FFCRA credit application and up to 20 weeks from that acceptance to receive your refund via check.
- The total tax credit can be up to $32,200, comprised of various qualifications. Each part is determined based on your net earnings in 2020 and in 2021.
- Please note, no qualification is guaranteed, and final eligibility must be approved by the client.
- Refunds for 2020 and 2021 will be sent to you directly by the IRS via check to the address provided on your amendment.
- If you have an outstanding balance owed to the IRS, the tax credit you’re eligible for would be the total credit minus your existing tax liability.
For assistance or questions regarding the SETC program, please contact us at [email protected]
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