According to a new IRS notice, leave donated by an employee to a qualified employer-sponsored leave bank following a major disaster is not considered income to the donating employee, as long as the leave received by an affected employee is treated as wages for purposes of FICA, FUTA, and income tax withholding.
Our HR Management & Compliance Report: How To Comply with California and Federal Leave Laws, covers everything you need to know to stay in compliance with both state and federal law in one of the trickiest areas of compliance for even the most experienced HR professional. Learn the rules for pregnancy and parental leaves, medical exams and certifications, intermittent leaves, required notices, and more.
The notice also spells out these requirements for a qualified major disaster leave-sharing plan: 1) a donor can’t designate a specific person to receive the leave; 2) recipients must use the donated leave for time away from work due to severe hardship caused by the disaster; 3) leave must be donated, and used, within a certain timeframe; 4) recipients can’t convert donated leave into cash; and 5) leave donated in the aftermath of one disaster can be used only for employees affected by that disaster.
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