The information provided on this website is for informational purposes only and is not intended to provide, and should not be relied upon for tax, legal, or other professional advice. Further, the information on this website may or may not reflect the most current legislative or regulatory PFL requirements. You should not act or rely upon this information without consulting your own professional advisor.
Taxation Guidance Is Finally Here for NY Paid Family Leave
August 31, 2017
The state of New York communicated Paid Family Leave rates and initial payroll deduction guidance on June 1, 2017. Now, after further review, the New York Department of Taxation and Finance has provided important guidance regarding payroll deduction and PFL taxation.
You'll find answers to your top taxation questions below:
- Employee-paid premiums should be deducted post-tax — not pre-tax.
- Regardless of how premiums are paid, benefits paid to employees will be taxable non-wage income that must be included in federal gross income.
- Taxes will not automatically be withheld from benefits; employees can request voluntary tax withholding.
- At this time, it appears that employees can choose to withhold a flat 10 percent of their benefit for federal taxes and a flat 2.5 percent of their benefit for state taxes.
- Employers should report employee payroll contributions on Form W-2 using Box 14: State Disability Insurance Taxes Withheld.
The state may provide further guidance in the future. We’ll post updates here as we receive them. Keep checking back!
Categories:
PFL Administration / New York