What happens when the tax extension shortens the window for employees to take PTO? For seasonal industries such as accounting, there has been a clearly defined time of year that employees are encouraged to take time off. On a typical tax season, the majority of individual and small business returns are completed by April 15th, giving accountants and tax professionals a few months of breathing room before the remaining business and individual returns on extension are due by October 15th.
However, due to COVID-19, the IRS enacted new policies and has granted a 90-day extension to the standard individual filing deadline. With this extended filing deadline, that means a vastly shortened window for when they can feasibly take time off. So what does that mean for firms’ liabilities of outstanding PTO owed sitting on the books, not to mention the potential of employee burnout?
According to data from the “2018 Best Firms to Work For” list published by Accounting Today, 65% of the firms ranked give, on average, 19 days of PTO in a lump sum to employees after year one. With the current trends showing that most people are still uncomfortable traveling due to COVID-19 risk, and many counties are still in a state of mixed business openings, this year shows a much lower-than-average use by employees of their allotted time off. The tax season is still going strong, months into when many accountants would typically be using their time off to plan vacations or take a much-needed opportunity for rest and recuperation. What are some options for firms that encourage employees to start using their PTO and avoid burnout once they reach July 15th? How can firms ensure they’re not setting themselves up for large payouts of PTO or massive call-ins at year-end when the vacation season is so short due to the revised tax deadlines?
It’s a bit of a balancing act right now to determine how to take care of employees’ wellness and needs for work reprieve, while still considering the firm’s liabilities. Navigating how this extension of tax season will affect the balances of employee PTO is crucial to helping firms prepare for the coming months and leading into what is hopefully a much calmer 2020 tax season ahead.
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