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New Jersey offers tax credits for organ and bone marrow donation leave

03/05/20

Author: ADP Admin/Wednesday, March 4, 2020/Categories: Compliance Corner , State Compliance Update, New Jersey

New Jersey has enacted legislation (Senate Bill 4188) that enables employers and employees to claim tax credits for organ and bone marrow leave. Additionally, Assembly Bill 1449 requires employers to provide job security to organ and bone marrow donors. Both laws take effect May 20, 2020.


Senate Bill 4188:

Employees:

Employees will be allowed to deduct up to $10,000 of earned gross income for reasonable, unreimbursed travel expenses, lodging, and lost wages related to their, or their dependent's, donation of an organ or bone marrow. The deduction must be claimed in the taxable year in which the donation occurs, except when any covered expenses are incurred in previous or subsequent taxable years.

Employers:

When employees miss time from work due to organ or bone marrow donation, their employer may be eligible for a tax credit. The amount allowed will be equal to 25 percent of the employee's salary during the time they missed work, up to 30 days per donation. For example, if the employee takes 15 days of paid time off for the donation, then the employer may claim a credit equal to 25 percent of the donor's salary for those 15 days. To earn the credit, time off must be paid.


Assembly Bill 1449:

Assembly Bill 1449 will amend New Jersey's disability law to provide protections to organ and bone marrow donors. The law clarifies that organ and bone marrow donation is considered a compensable disability to be paid within the first seven days of the period of disability.

Further, the law generally entitles an employee to be restored to the position held when disability commenced, or to an equivalent position with similar seniority, status, employment benefits, pay, and other terms and conditions of employment following donation.


Compliance Recommendations:

Covered employers should review policies, procedures, and training to ensure compliance with Senate Bill 4188 and Assembly Bill 1449 by May 20, 2020. Please contact your dedicated service professional with any questions.

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