Massachusetts Paid Family and Medical Leave Program: November 2025 End-of-Year Update

Quick Hits

• The Massachusetts Department of Family and Medical Leave (DFML) has issued its 2026 poster, individual notices, and rate sheets for the state’s Paid Family and Medical Leave program.
• The maximum weekly benefit amount and the state average weekly wage will increase slightly going into 2026, but for the third year in a row, the total contribution rates for employers and employees will hold steady.
• The IRS has issued tax guidance on Paid Family and Medical Payments, which the MA DFML has issued a detailed memorandum about.

The 2026 Workplace Poster

All Massachusetts employers must display a workplace poster prepared or approved by DFML that explains the benefits available under the MA PFML program. This poster must be displayed at the employer’s workplace in a location where it can be easily read (for example, near other mandatory workplace posters, such as wage-and-hour and workplace safety notices). Posters must be in English and each language that is the primary language of five or more individuals in the workforce, if translations are available from DFML. The 2026 DFML template workplace poster can be found at the department’s website.

2026 Notices for Individual Workers

Notices for individual workers have now been issued by the department. Employers may want to assess whether they are issuing the correct version of the notices based on the relevant number of covered workers:

• Employers with workforces with twenty-five or more covered individuals
• Employers with workforces with fewer than twenty-five covered individuals
• Self-employed individuals from employers with twenty-five or more covered individuals
• Self-employed individuals from employers with fewer than twenty-five covered individuals

New employees must be issued these notices within thirty days of hire. Like the poster, the notice must be available in English and each language that is the primary language of five or more individuals in your workforce. DFML provides translations in English and many other languages on its website.

2026 Rate Sheet Notices

DFML’s 2026 rate sheets are now available. There are two versions:

• 2026 rate sheet for employers with twenty-five or more covered individuals
• 2026 rate sheet for employers with fewer than twenty-five covered individuals

The DFML website advises that for current workers and self-employed individuals who have previously signed an individual notice, employers must provide information on these new rates thirty days in advance of the rate change effective date of January 1, 2026, which is roughly December 1, 2025. Electronic issuance of the notice is allowed.

Benefit Adjustments

There are several monetary adjustments, effective January 1, 2026, to be aware of:

• The maximum weekly benefit amount that a worker can receive in MA PFML benefits per week will be $1,230.39. This is a roughly $60 increase from 2025.
• The state average weekly wage will also increase slightly by roughly $93, up to $1,922.48.
• There is no change to the total contribution rates for employers and employees. This is the third year that the total contribution rates have held steady.

IRS Guidance on Taxability of Paid Family and Medical Leave Benefit Payments

On January 15, 2025, the IRS issued Revenue Ruling 2025-4, which addresses the tax treatment of contributions to and benefits received from state-paid family and medical leave programs, along with reporting requirements. Generally, the ruling draws a bright line between family and medical leave benefits, and, for Massachusetts employers, ties the medical leave tax outcome to employer size and contribution obligations. Ogletree’s article on the ruling can be found here. DFML has also issued a detailed memorandum on the Revenue Ruling 2025-4, which can be found here.

Family leave benefits are fully includible in gross income but are not wages for federal employment tax purposes; Massachusetts DFML will report them on Form 1099-G, and income tax withholding remains elective. By contrast, medical leave benefits are bifurcated: the portion attributable to employee contributions (including any employer pick-up) is excluded from income and is not considered wages, while the portion attributable to employer contributions is includible in income and treated as third-party sick pay wages for FICA and FUTA purposes.

Because Massachusetts requires employers with twenty-five or more employees to fund at least 60 percent of the medical contribution, 60 percent of DFML medical benefits paid to those employees will be taxable and wage-subject; such an employer must remit its share of FICA and FUTA on the taxable portion of DFML medical benefits and must report that taxable portion as wages on the employee’s Form W-2. Employers under the twenty-five-employee threshold do not owe the employer medical contribution, so DFML medical benefits paid to their employees are not taxable and are not wages; neither FICA nor FUTA is due on the medical benefits, and no Form W-2 reporting is required. The ruling also confirms that mandatory employee PFML contributions (and any employer pick-up of those contributions) are includible in the employee’s wages and reported on Form W-2.

FY 2025 Annual Report

The MA PFML statute requires DFML to issue annual reports containing information about applicants. The most recent annual report contains interesting statistical information regarding applicants for PFML benefits in FY 2025 (i.e., July 1, 2024, to June 30, 2025). DFML’s FY2025 Annual Report for the Massachusetts Paid Family and Medical Leave Program can be found on the department’s website.

Staying Informed

The DFML website includes links to the DFML’s regulations, notices, and other guidance. The DFML also issues a newsletter to which readers may subscribe.

Ogletree Deakins’ Boston office, Leaves of Absence / Reasonable Accommodation Practice Group, and Employment Tax Practice Group will continue to monitor developments with respect to the PFML program and will provide updates on the Employment Tax, Leaves of Absence, and Massachusetts blogs as additional information becomes available.

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