On August 25, 2017 the New York State Department of Taxation and Finance (DFS) released highly anticipated guidance regarding taxation of PFL benefits and premium in Notice N-17-12. Here are the key points:
- Benefits:
- 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
- Benefits should be reported by the State Insurance Fund on Form 1099-G and by all other payers on Form 1099-MISC
- Premiums:
- The premiums will be post-tax, i.e., deducted from an employee’s after-tax wages
- Employers should report employee contributions on Form W-2 (Box 14: State disability insurance taxes withheld)
This blog post is for informational purposes only and is not intended to provide legal counsel. Please consult with an appropriate professional for legal and compliance advice. Any PFL information is as of the blog post’s date stamp; it is based on the applicable statutes and regulation, and may change as regulations evolve or NY State issues guidance regarding Paid Family Leave regulations. Have more questions? Email us at pflquestions@shelterpoint.com