Who Qualifies for
SETC Tax Credits
What are SETC Tax Credits?
In 2022, Congress introduced the Self-Employed Tax Credit (SETC) in response to the financial challenges faced by self-employed Americans after the COVID-19 pandemic began. This tax credit offers a valuable opportunity, specifically designed for small business owners, 1099 independent contractors, freelancers, and gig workers who experienced financial hardships during the 2020 and 2021 tax seasons. Surprisingly, between 30 and 50 million qualified individuals have just learned of the SETC program. Are you one of these qualified individuals?
Introduction to SETC Tax Credits Eligibility
Qualified self-employed individuals engaging in a trade or business, as defined in section 1402 of the Internal Revenue Code, are entitled to tax credits for their “qualified sick leave equivalent amount” or “qualified family leave equivalent amount” against federal income taxes. These credits align with requirements under the Families First Coronavirus Response Act, treating the individual as if they were an employee of an eligible employer subject to those requirements.
To qualify for the qualified sick leave equivalent credit and/or the qualified family leave equivalent credit, individuals must regularly conduct a trade or business as eligible self-employed individuals, meeting the criteria of section 1402 of the Internal Revenue Code. This includes conducting a trade or business or serving as a partner in a partnership engaged in a trade or business, as outlined in section 1402(c) of the Internal Revenue Code for compliance with section 1402.
Who Qualifies for SETC Money?
Key Eligibility Criteria for SETC Refund:
1
Self-Employed Status
If you worked as a self-employed person in 2020 or 2021, you may qualify for the SETC. This category includes a diverse range of entrepreneurs, such as sole proprietors managing businesses with employees, gig workers, 1099 subcontractors, and single-member LLCs. This can include those who work remotely as well.
2
COVID Impacts
The SETC provides support to those who were directly affected by COVID-19. Eligibility extends to individuals who battled the virus, experienced COVID-like symptoms, underwent testing, needed to quarantine, or served as caregivers to family members affected by the virus. If the closure of your child’s school or daycare due to COVID restrictions compelled you to stay home and impacted your work, you may also qualify.
Qualifying circumstances include:
Quarantine
- Compliance with COVID-19-related federal, state, or local lockdown orders.
- Being subject to a quarantine or isolation order related to COVID-19.
Illness
- Providing support to someone subject to a COVID-19-related quarantine or isolation order.
- Caring for a child affected by school or childcare closures due to COVID-19.
- Experiencing COVID-19 symptoms, seeking a medical diagnosis, or suffering from vaccination side effects.
Vaccination
- Attending a COVID-19 vaccination appointment.
- Experiencing side effects due to COVID-19 vaccination.
Other Similar Conditions
- SETC eligibility extends to individuals facing circumstances similar to those outlined by the Secretary of Health and Human Services, following consultations with the Secretary of the Treasury and the Secretary of Labor
3
Childcare
Eligibility also covers situations related to childcare, such as:
- Caring for a child whose school closed or transitioned to virtual learning.
- Providing care for a child when the usual childcare provider was unavailable due to COVID-19.
Note: Entities like Sub S or True S Corps / C Corps are excluded from SETC eligibility. The credit is exclusively available to those who filed a “Schedule C” or a Partnership (1065).
At SETC Pros,
We Make the SETC Tax Credit Claims Simple!
Take advantage of the opportunity to claim your Self-Employed Tax Credit (SETC) of up to $32,220! SETC Pros is your trusted partner in navigating the complexities of the tax system. Seize the benefits you deserve as a small business owner, freelancer, gig worker, or sole proprietor.
Act now! Get the free quote. Discover how much money you may be entitled to. It takes only a few minutes to apply.
Choose SETC Pros! We’ll make the claims process simple for you.
Let’s Check to See If You Qualify
If qualified, you are eligible for up to $32,220 in relief funds!
