Treasury Department Expands Tax Incentives for Paid Family Leave

The U.S. Treasury Department will announce new guidance on Wednesday to expand tax incentives for employers providing paid family leave. The policy modifies a 2017 tax credit by allowing employers to claim the incentive if they pay insurance premiums to cover leave costs, rather than paying wages directly.

To qualify for the credit, employers must provide at least two weeks of family and medical leave equivalent to at least 50% of an employee's wages. This expansion is part of the Trump administration's One Big Beautiful Bill Act.

Administration officials are utilizing the policy to support vulnerable Republican candidates before the midterm elections. Treasury Secretary Scott Bessent and House Speaker Mike Johnson are scheduled to meet in Phoenix to discuss the policy's implementation alongside Arizona Representative Juan Ciscomani. White House spokesman Kush Desai characterized the move as a victory for working parents.