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Paid Family and Medical Leave Benefits Available to Massachusetts Employees on Jan 1, 2021 Insights Holland & Knight

The amount from Box 2 is reported on Line 62 of Form 1040, on Line 36 of Form 1040A, or on Line 7 of Form 1040EZ. If you have several W-2 forms, add up the Box 2 amounts just as you did with your income. If an employer failed to maintain a private plan or had its approval withdrawn by the Department, the Department may assess a penalty of up to an amount equal to the employer’s total annual payroll, multiplied by the applicable annual contribution rate. The employer may also be required to pay interest on this amount. Further, the employer may also be required to repay the amount paid to workers who received PFML benefits during the period that the employer failed to maintain its approved private plan. The Department is accepting employer applications for private plan exemptions on a rolling basis. An employer’s application must be approved by the Department in the quarter prior to the quarter in which the private plan will go into effect. The Department has explained that employers applying for an exemption will receive an email notification within one to two business days indicating that a determination has been made on the employer’s application.

• In addition, the tax-free benefit must be limited to $5,250 per calendar year.
• If the employee receives an electronic Form W-2, then the statement must be provided in the same manner and at the same time as the Form W-2.
• Currently, there are no federal legal requirements for paid sick leave.

The employee remains responsible for their share of any health insurance premiums while on PFML. The premiums are remitted quarterly to the state with payment due at the end of the next month following the end of each quarter. While presumably most employers will participate in the state plan, they have an option to use a voluntary plan. If the plan is approved, it may be used, provided the plan’s benefits meet or exceed the benefits provided by the state plan. A list of current employers with an approved voluntary plan is maintained on ESD’s website. For employers with 50 or more employees, the premium is split between the employer and the employee. Employers may optionally pay for all or part of the employee’s share in addition to the employer’s share.

Insight: Consider how the proposed ESG rule affects your plan today

An employer is not entitled to reimbursement for any amounts paid to an employee to “top off” the employee’s PFML benefits. Under the PFML program, most employees will be eligible for a maximum of 12 weeks of partially paid leave. The benefit amount will be a maximum of $1,000 per week, as calculated by the ESD. Employers subject to the paid leave requirements of the Act should check with their payroll providers to make sure this information is captured and will be provided with the 2020 Forms W-2. This requirement applies even to employers that don’t anticipate any of their employees having self-employment income. If your business is subject to state-mandated paid family leave, you likely want to know if employee PFL benefits are taxable … and if you’re the one responsible for taxing them. Small employers with fewer than 25 employees can choose to contribute but are not required to pay into the program.

This third party will also need a power of attorney to https://intuit-payroll.org/ on your behalf. Employers reporting via file upload (.CSV) should use the updated.CSV filinginstructions and the new.CSV filetemplate. This webinar gives employers a general understanding of how Paid Family and Medical Leave works and how to make payments. Before you can report for individual clients, you need to link your employer agent account to their employer account. Log-in to your Paid Leave employer agent account through SAW and select “Submit Quarterly Wages” from the “Wage Reporting” menu. Paid Family and Medical Leave has differentfile specifications than other state agencies. We recommend that youtest your file format before submitting quarterly reports.

Collaborate with the right service providers to educate your participants

Here, we Reporting Wages Subject To Paid Family And Medical Leave an update on the DOL’s proposed rule and seek to help plan sponsors understand their potential new responsibilities when considering ESG investments. The Department of Labor is preparing to finalize a proposed rule that changes the way environmental, social, and governance factors are viewed in a plan sponsor’s investment process and proxy voting methods. The proposal, which was issued in October 2021, aims to help plan sponsors understand their responsibilities when investing in ESG strategies and makes significant changes to two previously issued ESG rules. Through its website MyMoney.gov, the Financial Literacy and Education Commission has taken the lead on educating consumers, investors, and businesses on financial issues.