NY PFL Taxes

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Meta Title: NY PFL Taxes: How New York Paid Family Leave Is Taxed

Meta Description: NY PFL benefits are taxable federally but not by New York State. Report on Form 1040 line 8. Contributions not deductible. 2025 tax treatment explained.

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H1

NY PFL Taxes: Federal and State Tax Treatment Guide

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ANSWER SECTION

NY PFL benefits are taxable at the federal level but exempt from New York State income tax. When you receive NY PFL payments, your employer includes the amount in Box 1 of your W-2 as wages. Report these benefits on Form 1040, line 8 (Other Income). While you pay federal income tax on NY PFL, you do not pay Social Security or Medicare taxes (FICA) on these benefits. Your payroll contributions to fund NY PFL are not tax-deductible.

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H2: Federal Tax Treatment of NY PFL

Taxable as income: Yes — include in gross income

Where to report: Form 1040, Schedule 1, line 8z (Other Income), then carry to Form 1040, line 8

W-2 reporting: Box 1 (Wages, tips, other compensation) includes NY PFL benefits

FICA exemption: NY PFL benefits are NOT subject to:

• Social Security tax (6.2%)
• Medicare tax (1.45%)
• Additional Medicare tax (0.9% for high earners)

Federal withholding: Your employer should withhold federal income tax from NY PFL payments unless you elect otherwise. The default withholding rate is typically 10%.

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H2: New York State Tax Treatment

NY State income tax: NY PFL benefits are exempt from New York State personal income tax

NYC/Yonkers tax: Also exempt from city income taxes

W-2 Box 14: Your employer may report "NYPFL" contributions here for informational purposes only. This does not affect your tax calculation.

No double taxation: Because you contributed after-tax dollars to fund the program, New York does not tax the benefits when received.

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H2: How NY PFL Contributions Work

Employee contribution rate (2025): 0.373% of gross wages, up to the wage cap

Wage cap: $1,757.19 per week (2025)

Tax deductibility: Contributions are NOT deductible on either federal or state returns

After-tax treatment: You fund NY PFL with after-tax dollars, similar to Roth 401k contributions

Key Form: W-2 (Box 1 for benefits received, Box 14 for contributions made)

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H2: Reporting NY PFL on Your Tax Return

Step 1: Review your W-2 Box 1 for the total NY PFL benefits received during the tax year.

Step 2: Confirm the amount is included in your total wages on Form 1040, line 1.

Step 3: If your employer did not include NY PFL in Box 1 (uncommon), report it on Schedule 1, line 8z.

Step 4: Do not report NY PFL benefits separately on your New York State tax return—they are exempt.

Common issue: Some tax software may automatically exclude NY PFL from New York State taxable income. Verify this treatment if your software prompts you about "taxable state benefits."

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H2: Related Tax Questions

For complete program details including eligibility and benefits, see our what is NY PFL guide.

Learn about W-2 box placement for NYPFL in our what is NY PFL tax page.

For comparison with California's disability program, review our SDI tax and California SDI tax guides.

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