My Paid Family Leave (PFL) in California was paid by EDD but it is included in my W-2. In this case, is PFL taxable on state return?

[napoleonzhen]

Hi,

I have a question regarding to this post: What do I need to know about Paid Family Leave (PFL) in California?

It said if "My PFL was paid by my employer on my W-2" -> "Your PFL income is taxable on both your federal and state return."

In my case, California Employment Development Department (EDD) did pay me the PFL benefits because I received the benefit letter from EDD. However, I receive the total compensation through my employer, my PFL benefits is included in my W2, so I did not receive the 1099-G. In this case, is PFL benefit taxable on the California state return?

Thanks a lot for your help!

[BillM223]

Based on the letter from the CA EDD, no, your PFL is not taxable in California. But you MUST keep this letter because this contradicts what California has written in its instructions, which is that PFL on the 1099-G is not taxable on the state return, PFL on the insurance company's W-2 is not taxable on the state return, and PFL on the employers' W-2 is taxable on the California return.

It would be smart to contact the EDD and see if you could confirm this in writing.