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IRS Reverses Course; H-2A Wages Now Eligible for FFCRA Tax Credit

February 1, 2021

Good news for H-2A employers: the IRS has reversed course on its interpretation of whether H-2A wages are eligible for the Families First Coronavirus Response Act (FFCRA) tax credit.

On January 28, 2021, the IRS issued new guidance in the form of an FAQ stating that employers are entitled to tax credits under the FFCRA for qualified leave wages paid to H-2A workers. The FAQ can be found on the IRS website. The IRS withdrew its original guidance disallowing the credit for H-2A wages.

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