Specifically, after consulting with the Internal Revenue Service and other resources, the DTF has directed that employee contributions will be deducted from employees’ after-tax wages, and that employers should report such contributions on Forms W-2 using Box 14.
With respect to PFL benefits, the DTF guidance indicates that such benefits will be treated as taxable nonwage income that must be included in federal gross income. While taxes will not automatically be withheld from PFL benefits, employees can elect to request voluntary tax withholding. Finally, the DTF guidance also provides that all benefits paid to employees should be reported on Form 1099-MISC, with the exception of those paid by the state insurance fund, which should be reported on Form 1099-G.
As deadlines for complying with the PFL approach, we will be closely monitoring this law and reporting further developments.
Shabri Sharma is an Associate in the New York City office, where she represents and advises management in all aspects of employment law. Ms. Sharma has experience in advising and counseling employers regarding employment discrimination claims, mandatory arbitration policies, independent contractor audits, terminations, severance agreements, recent legal developments, and other related employment issues. Ms. Sharma also delivers employment training to hundreds of employees. Prior to joining...