Ask the Advisors: Family Leave Law, Economic Stimulus Law

Dear Advisor:

I need to take some time off from work to take care of my elderly mother. I've heard I can through the Family Leave Law. What is that all about? How much time can I take off from work?

To many employers and employees, the Family and Medical Leave Act (FMLA) – which was enacted back in 1993 – remains a mystery. There still is a great deal of confusion about this significant workplace law. Here is a brief summary of some of the key provisions of the FMLA.

In essence, the law permits eligible employees to take up to 12 weeks of unpaid leave from work for the birth or adoption of a child, for reasons relating to their medical conditions or to care for another family member. An eligible employee maintains benefits during the leave period, but must continue to pay the required employee portion for such benefits. The employee also has the right to return to the same or equivalent position, pay and benefits at the conclusion of the leave.

Eligible employees: An eligible employee is someone who has been employed by the business for at least 12 months and who has worked at least 1,250 hours during that period. This rule applies if the business has 50 or more employees within 75 miles of the worksite.

Employee notification: The employee must provide 30-day advance notice for foreseeable events. This includes scheduled surgery and the adoption or birth of a child. The employer is allowed to delay the leave if the employee fails to provide the requisite 30-day notice.

Proof of condition: The employer may request that the employee obtain certification from a health care provider in order for the employee to take a medical leave. Upon completion of a leave for the employee's own medical condition, the employer may require that the employee obtain a certification of fitness to return to work. The employer can delay the start of FMLA for 30 days if the employee does not provide advance notice or proper certification.

Employer notification: An employer must give an employee requesting FMLA written notice, within two business days, if the employee is not eligible for FMLA. If the employer does not respond to a leave request within two business days, the employee is eligible to take the leave.

Consecutive weeks: The employee does not have to take the leave in consecutive weeks. Instead, the employee may take 12 weeks off during any 12-month period. The leave may be taken on an intermittent basis. For instance, an employee might switch to part-time status until the equivalent of 12 weeks has been used.

Display of notice: Employers covered by the FMLA must display a notice outlining the law's provisions. The notice must be displayed in a conspicuous place whether or not the employer currently has any eligible employees.

Of course, this is only a general overview of some of the provisions of the FMLA. If you have additional questions or concerns about your personal situation, consult with a legal and/or business advisor.

Dear Rehmann: Can you explain what the Economic Stimulus Law is about?

The new Economic Stimulus Act of 2008 – signed by the President on February 13 – is designed to spur spending. Of course, the main focus of the new law is the one-time rebates for individuals. But there is more to this new legislation than first meets the eye. Let's take a closer look at the main tax components of the new economic package.

Tax rebates: Most single filers will receive a one-time rebate of $600. This rebate amount is doubled to $1,200 for joint filers. If you have children under age 17, you may qualify for a rebate of $300 per child. There is no set limit on the number of rebates for children.

However, the rebates for both single and joint filers gradually phase out above certain thresholds. The phase-out begins at an adjusted gross income (AGI) of $75,000 for single filers and $150,000 for joint filers.

In addition, other individuals who do not pay income tax but have at least $3,000 in taxable income, generally are entitled to a $300 rebate. These rebates are doubled to $600 for qualified joint filers. The eligible beneficiaries may include Social Security recipients and disabled veterans (or surviving spouses of disabled veterans).

Section 179 deductions: In a temporary measure, the new law increases the Section 179 "expensing deduction" for assets placed in service in 2008. The maximum inflation-indexed amount of $128,000 jumps all the way up to $250,000 this year.

Furthermore, the dollar threshold for reducing the maximum Section 179 deduction for 2008 increases from $510,000 to $800,000. (The deduction is reduced dollar-for-dollar for amounts above the threshold.)

Bonus depreciation deductions: A qualified business may be able to claim a 50% bonus depreciation deduction for assets placed in service in 2008. This bonus deduction comes right off the top. The remaining balance is still available for regular depreciation deductions under the Modified Accelerated Cost Recovery System (MACRS).

Remember that this only a brief overview of the new tax law. Obtain more detailed information pertaining to your situation.

Laura Macke, CPA, MST, is a senior tax manager for The Rehmann Group and is located in the Traverse City office. Her areas of expertise include tax compliance, tax planning, fiduciary, estate & gift and oil & gas taxation. Contact Laura at 946.3230 or by e-mailing laura.macke@rehmann.com.

Erickson Braund is a financial advisor for Rehmann Financial and is located in the Traverse City office. He brings over 13 years of experience in Financial Planning. Advisory services offered through Rehmann Financial, a Registered Investment Advisor. Securities offered through Triad Advisors, Member FINRA/SIPC. Contact Eric at 231.946.3230 or by e-mailing eric.braund@rehmann.com.

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