My opinion:
- The department of labor offers a comparison chart for types of sick and family leave here. The paid family leave is compared to an insurance policy reminiscent of a disability plan.
- The state of NY has decided their matching version of Paid Family Medical Leave will be taxable.
- WA offers free help.
- In an insurance plan, like disability, if you pay the premiums, then the collection is tax free. While if you did not pay the premiums, you pay taxes on the income.
Putting all of this together, makes me think this will probably end up being taxable. I imagine there will be lawsuits to settle the issue definitively.
Since the IRS has not made it taxable yet, I would not report it.
If you want to go ahead and pay taxes on it, you can enter it as Less Common income > Other Reportable income. This allows you to pay the federal tax- not the Medicare and Social Security tax.
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