Tax Implications of New York Paid Family Leave

Aug 31, 2017

tax implications of new york paid family leaveNew York State’s Department of Taxation and Finance released guidance regarding the tax implications of New York Paid Family Leave (PFL), the benefits of which take effect on January 1, 2018. As PFL premiums are funded through employee payroll deductions, the Department has reviewed the tax treatment of these contributions, along with reviewing the tax treatment of the PFL benefit itself.

The Department is providing the following guidance:

  • 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
  • Premiums will be deducted from employees’ after-tax wages
  • Employers should report employee contributions on Form W-2 using Box 14 – State disability insurance taxes withheld
  • Benefits should be reported by the State Insurance Fund on Form 1099-G and by all other payers on Form 1099-MISC


Employers need to begin preparing for implementation of this new benefit before January 1. Read more about how New York PFL will impact employers, and how employees can use this benefit.

Call us at (518) 373-4111 for more information.

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