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raltmann2020
New Member

Issued a 1099G for Family Leave - Tax Exempt like Unemployment for 2020?

My state issued me a 1099G for Family Leave during 2020.  When I enter that into Turbotax it assumes it is tax exempt. (I assume it thinks it's Unemployment pay since it uses the same form, which is exempt for 2020 under the American Rescue Plan). I don't believe that is correct. How do I force TurboTax to override this setting?

5 Replies
BillM223
Employee Tax Expert

Issued a 1099G for Family Leave - Tax Exempt like Unemployment for 2020?

Which state? In some states under certain conditions, Paid Family Leave is exempt from state tax. This was true long before the American Rescue Plan.

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raltmann2020
New Member

Issued a 1099G for Family Leave - Tax Exempt like Unemployment for 2020?

I know that it's exempt for State. It's the Federal that is unknown. I'm guessing it's still taxable for Federal but nobody seems to know the answer.  And if I want to err on the same side and make it payable, how should I force it through?

BillM223
Employee Tax Expert

Issued a 1099G for Family Leave - Tax Exempt like Unemployment for 2020?

Our tests show us that Paid Family Leave, properly entered in the screen following the W-2, is being taxed as income, just as it should be.

 

Did you check the paid family leave box on the screen with the heading "Do any of these uncommon situations apply to this W-2?"

 

 

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raltmann2020
New Member

Issued a 1099G for Family Leave - Tax Exempt like Unemployment for 2020?

The State of NJ issued a 1099G.  Box 1 for FMLA. 

 

Are you suggesting that to force Turbotax I should ignore it as a 1099 and instead add it in the W2 section?

 

It was not paid out by my employer at all. I was issued the funds directly by the State.

Cynthiad66
Employee Tax Expert

Issued a 1099G for Family Leave - Tax Exempt like Unemployment for 2020?

Here's where to report your 1099-G for unemployment or paid family leave.

If you're using the TurboTax mobile app, follow these instructions.

Unemployment compensation and paid family leave are entered in the same place:

  1. Open or continue your tax return.

  2. Search for 1099-G and select the Jump to link at the top of the search results.
  3. On the Did you receive unemployment or paid family leave benefits in 2020? screen, answer Yes.
  4. Follow the onscreen instructions to enter your 1099-G information.

 

According to the IRS, Paid Family Leave (PFL) benefits are considered a type of unemployment compensation and are reportable for tax purposes. Your PFL benefits are taxable and reportable on your federal return only. For further information about PFL, visit State Disability Insurance or call 1-877-238-4373.

 

 

The Department of Labor says:

 

If you received any of the following benefits in 2020, you need to log in to your account to download a 1099-G form for your 2020 tax return.

  • Family Leave Insurance benefits
  • Family Leave During Unemployment Insurance benefits
  • Disability During Unemployment Insurance benefits
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