Did you know that October is National Work and Family Month? Established in 2003 by a Senate resolution, it recognizes the importance of creating more flexible work environments and helping individuals better balance their work-life commitments.
A proven way to support working families is through paid family and medical leave benefits (PFML). In fact, 47% of the full-time workforce has access to a short-term disability plan that provides personal medical leave and maternity leave. So, we were heartened to see the Internal Revenue Service as part of its celebration of National Work and Family Month highlight a tax credit that gives employers a valuable incentive to provide family and medical leave for their employees.
Sponsored by Sen. Deb Fischer (R-NE) as part of the 2017 Tax Cuts and Jobs Act, this tax credit is provided to employers who offer paid family and medical leave to qualifying employees. The credit incentivizes employers to provide leave by reducing their program’s cost.
Unfortunately, the credit will expire on Jan. 1, 2020. Sens. Fischer and Kyrsten Sinema (D-AZ) introduced a bipartisan bill that would extend the credit for three years. Rep. Mike Kelly (R-PA) has companion legislation in the U.S. House.
The American Council of Life Insurers (ACLI) supports these bills. And we have urged Congress to make this credit permanent. In a letter to the Senate Finance Committee Health Task Force in June, we noted the importance of providing as much long-term certainty as possible in the Tax Code.
We also emphasized that any PFML legislative proposal should include and expand upon the vibrant private marketplace. In 2017, the private insurance-based system paid American workers approximately $4.6 billion in short-term benefits as they recovered from conditions that kept them from working. The largest volume of claims paid are maternity related.
Our insurance companies help families to grow and prosper by providing options to employers and supporting private-sector solutions that further expand access to paid family and medical leave for all Americans. Making the Fischer tax credit permanent would prompt more employers to help their employees with this critical benefit.
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