Calculating the SETC Tax Credit Refund
Once you've established that you qualify for the SETC Tax Credit, the subsequent step is to calculate your potential credit amount.
You can learn how below. The SETC Tax Credit amount is determined by your average daily self-employment income and the total workdays you missed due to COVID-19 impacts.
For instance, the qualified sick leave equivalent amount is equal to the lesser of $511 or 100% of your average daily income from self-employment for a set number of days when you were unable to work because of reasons like quarantine or experiencing COVID-19 signs.
On the other hand, the qualified paid family leave equivalent amount is the lower of $200 or two-thirds of apply for setc tax credit your average daily self-employment income.
This is applicable for days when you couldn’t perform services due to COVID-19 setc tax credit related reasons.
Moreover, if you and your spouse are self-employed, you can each claim up to a specified SETC Tax Credit limit, as long as you don't share the qualifying COVID days.
To determine your SETC Tax Credit, you would use IRS Form 7202, which takes into account eligibility based on self-employment status and COVID-related interruptions, as well as the family leave tax credit.