Calculating the SETC Tax Credit Refund
Once you've established that you qualify for the SETC Tax Credit, the next 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 number of workdays 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 set number of days when you were unable to work because of reasons like being quarantined or having COVID-19 symptoms.
On the other hand, the qualified paid family leave equivalent amount is the lesser of $200 USD or 67% of your daily what is the setc tax credit income from self-employment on average.
This applies for days when you couldn’t perform services because of COVID-19 related reasons.
Moreover, if both you and your spouse are both self-employed, you apply for setc tax credit can both claim up to a specified SETC Tax Credit limit, as long as you don't share the qualifying days related to COVID.
To calculate 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 leave tax credit.