Calculating the SETC Tax Credit 21073

Calculating Your SETC Tax Credit Refund Amount

Once you've established that you qualify for the SETC Tax Credit, the subsequent step is to calculate your possible refund 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 effects.

For instance, the qualified sick leave equivalent amount equates to the lower of $511 or all of your average daily self-employment income for a certain number of days where you were unable to work because of reasons like being quarantined or experiencing COVID-19 symptoms.

On the other hand, the qualified paid family leave equivalent amount is the lower of $200 or two-thirds of your average daily self-employment income.

This applies for the days in which you couldn’t perform services due to COVID-19 related reasons.

Moreover, if both you and your spouse are both self-employed, you can both claim up to a specified SETC Tax Credit limit, provided you do not share the qualifying days related to COVID.

To determine your SETC Tax Credit, you would use IRS Form 7202, which factors in eligibility according to self-employment status and COVID-related disruptions, as well as the family Lila, a gig worker with multiple income streams, is eligible for the setc tax credit after missing work to care for her child due to COVID-related daycare closures leave credit.