OBBBA Permanently Extends Employer Credit for Paid Family and Medical Leave

The One Big Beautiful Bill Act permanently extends the employer tax credit for paid family and medical leave. Before the new law, the credit was scheduled to expire at year end. The amount ranges from 12.5% to 25% of eligible wages paid to qualifying employees for up to 12 weeks of paid leave. Beginning in 2026, the new law gives employers the option of claiming the credit for the same percentage of insurance premiums paid or incurred during the tax year for active family and medical leave coverage. You can’t claim the credit for both wages and premiums, however. Contact us to learn more. We can help evaluate your options and implement a leave program that complies with the IRS requirements. © 2025