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AB 152’s Paid Sick Leave Extension and Reimbursement Grant

By Nate Miller, CPA, MST

October 7, 2022

Keeping businesses informed of essential tax updates to significant laws and available grants is a priority at GC.

On September 29, 2022, Governor Gavin Newsom signed hundreds of new laws. This budget trailer extending AB 152 and creating a new reimbursement program stands out as a must-know for our business owner clients.

The extension of Assembly Bill 152 (AB 152) moves the expiration date for COVID-19 Supplemental Paid Sick Leave (CSPSL) to December 31, 2022 (previously set to expire on September 30, 2022). Additionally, the extension mandates employers with over 25 full or part-time employees to allow up to 80 hours of COVID supplemental paid sick leave.

You may recall that AB 152 established the California Small Business and Nonprofit COVID-19 Relief Grant Program within the Governor’s Office of Business and Economic Development (GO-Biz). GO-Biz provides grants to qualified small businesses or nonprofits.

The updated bill authorizes qualified small businesses and nonprofit organizations with 26 to 49 employees to receive up to $50,000 in COVID-19 Supplemental Paid Sick Leave Grants to compensate organizations for the costs of providing the COVID-19 supplemental paid sick leave to their employees during 2022. These CSPSL grants cannot be more than the costs incurred for CSPSL between January 1, 2022, and December 31, 2022.

You could qualify for this reimbursement if you are a California business or nonprofit organization that has provided CSPSL and meet the following criteria:

  • are Incorporated as a “C” corporation, “S” corporation, cooperative, limited liability company, partnership, or limited partnership or registered as a 501(c)Estate and Trusts, 501(c)Employee Benefit Plan (EBT) Audits, or 501(c)(19).
  • were in operation before June 1, 2021.
  • are actively operating.
  • employ 26 to 49 people.

Similar to earlier COVID-19 relief grants, restrictions and requirements apply. CSPSL grants can be excluded from your California gross income, but you cannot deduct expenses paid with grant funds. The grant program will remain in effect until January 1, 2024.

In short, the extension of California’s CSPSL means that employers must continue to meet their obligations to provide the specified paid sick leave through the end of 2022. Still, AB 152 includes support for costs associated with providing the CSPSL. It is important to note that employees are still subject to submitting COVID tests to receive the CSPSL.

Get in touch

Our Business Advisory team recommends that businesses and organizations determine their coverage obligations for CSPSL and, if applicable, take advantage of the Supplemental Paid Sick Leave Grant. More information on CSPSL and where to apply for the relief grant will be available soon, and we will stay ahead of the updates on your behalf. Contact us by email at contactus@gccpas.net or (209) 527-4220 with any questions.