Maternity benefit - Paid family leave without 1099G

[tbo1]

Hi,

My spouse received a W2 from Lincoln insurance company for the benefit during her maternity leave. However she didn't get a 1099-G. The W2 has wages/taxes paid as well as a separate amount in box 12a under category J. I believe this is Non-taxable sick pay.

While adding this W2 in Turbo Tax, there is a checkbox "Paid family leave - I earned all or part of this income as paid family leave." Does this need to be checked ? If it is checked , does the entire W2 income be considered non-taxable for California tax reporting or just the amount under box 12a code J become non-taxable ?

Also is it common to get paid family leave without receiving 1099-G, but with only insurance's W2 ?

[VictoriaD75]

Yes. You should check the box for Paid Family Leave if the income reported on the W-2 is attributable to such.

You will need a copy of the 1099-G to file. You can request a copy of your Form 1099-G by calling the EDD’s Interactive Voice Response system at 1-866-401-2849 and following the instructions. The Interactive Voice Response system is available 24 hours a day, 7 days a week. A copy of your Form 1099-G will be mailed to you within five business days.

Your California Paid Family Leave benefits you received (such as being out on Maternity Leave) are considered taxable income by the IRS, because they consider Paid Family Leave a type a unemployment compensation.  However, for California state tax purposes, the Paid Family Leave income is entirely exempt.

[tbo1]

Hi, Thanks for the reply. Looks like only box 12 a category J (sick-pay) should be non-taxable. However if I check that PFL box, turbotax seems to consider the entire W2 income as non-taxable. Is that correct ?

[KrisD15]

If the state paid the benefit, you would receive a 1099-G. 

Your benefits were paid through a third party. 

How much is taxable depends on who paid the policy, the employer, employee, or both. 

I would GUESS that they both paid and her portion of non-taxable benefit is in Box 12. 

If there are wages listed in box 1, they are taxable. 

What makes you say that TurboTax is considering this as non-taxable? Is the amount listed on your 1040?

[christytran67]

Hi, 

I have the same question as the original poster. The reason it seems like Turbo Tax is treating all of my W2 (not just the family leave part) as not taxable is because when I click on that button, it seems to give me a refund that's equal to about 10% of my total wages as the CA state refund estimated amount. 

[Messid]

I believe there is a bug in the TurboTax software. As soon as I check the PFL box,TurboTax shows that most of the CA taxes I paid, as refunds. I called TurboTax and spent an hour and spoke to 3 different people and none of them could resolve this issue. Turbo tax sucks. It has a lot of bugs. 

[BillM223]

There is no bug; the problem is that companies in California call things PFL (Paid Family Leave) when they are not, causing no end of confusion for taxpayers.

PFL should be reported to you in only one of two ways:

* a 1099-G from the CA EDD

* a W-2 from the insurance company which has the PFL policy

Anything reported on your employer's W-2 is probably not PFL under the laws of the state of California.

Please see the following:

***

Paid Family Leave (PFL) is income that is taxable on the federal return but is non-taxable on the California state return if it

• is paid by the state's Employment Development Department (EDD) and appears on a 1099-G form –OR–
• is paid by an insurance company under a Voluntary Plan for Disability Insurance (VPDI) and reported on a W-2 from the insurance company.

To repeat: PFL is not included in your employer's regular W-2 but on a separate W-2 from the insurer.

Amounts called “PFL” that are paid by your employer and which appear on the W-2 from your employer (see last image below) are taxable both on the federal level and by the state of California.

When you mark a W-2 in TurboTax as being PFL, a screen about PFL appears in the California section of the interview.

**W-2 Interview**

**California Interview**

The amount of wages on the W-2 marked as PFL is displayed so you don't have to look it up, but you are asked enter the amount (if any) that was paid by an insurance company, and not your employer.

If none of the amount was paid by an insurance company but all of it was paid by your employer, then you must enter zero (0) in the wages box on this screen, because any amount reported by your employer in box 16 of a W-2 is considered by California as compensation for services or taxable fringe benefits.

Note that compensation for short-term disability, vacation days, sick leave, and other employer benefits are not considered to be tax-free PFL.

Questions?

[mcklumin]

So essentially if my employer paid for the PFL (and not the 3rd party insurance company) via W-2, then I do check 'Paid Family Leave' box? I'm curious because I was already taxed on my W-2.

If so, what value do I put for 'Paid Family Leave' then? CAVPDI in Box 14 or CA Paid Family Leave Payment?

[BillM223]

"then I do check 'Paid Family Leave' box?"

No, do not check the Paid Family Leave box in the screen after you enter the W-2. If your employer paid it, it is not what California considers Paid Family Leave.

"If so, what value do I put for 'Paid Family Leave' then? CAVPDI in Box 14 or CA Paid Family Leave Payment?"

If you do not check the PFL box after the W-2, then the Paid Family Leave Income in California (see screenshots above) will not appear, so you don't enter any value.

If you are referring to some other screen, then come back and tell us.

[GeorgeM777]

The family benefit you received is probably taxable.  Benefits you receive under the paid family leave program are taxable and included in your federal and District gross income.  You did not mention whether you are a DC resident.  The reporting requirements and withholding options are different for non-DC residents versus DC residents. 

While you did not receive a 1099-G, you should have received a Form 1099-G from the District reporting the payments you received during the year.  If you are a non-DC resident, please contact the appropriate state tax agency for guidance on taxability of benefits in your state.

Because the Paid Family Leave program is administered by the Department of Employment Services (DOES), Office of Paid Family Leave (OPFL), you might want to contact that office to obtain your 1099-G or any other document/information you might need.

@lchakkalakal

[TeresaM]

If it is in box 14 of your Form W-2, with a description of EPSLA 511 or EPSLA 200 that will be from the Families First Act and the drop down category should match the image below, either for 511 or 200.
 

If it is a different description or not on your Form W-2, please let us know more details and we are happy to investigate.

[BillM223]

The DC government says that this income is taxable on the federal return and in DC:

"What you need to know about paid family leave and taxes:

Benefits you receive under this program are taxable and included in your federal and District gross income. You will receive a Form 1099-G from the District reporting the payments you received during the year.

If you are a non-District resident, please contact the appropriate state tax agency for guidance on taxability of benefits in your state." See this DC webpage.

Note that the second paragraph leaves open the possibility that the benefits might not be taxable in your state of residence.

[BillM223]

"I contacted both those departments  and they say they don't provide a 1099G??"

Well, since the DC Office of Tax and Revenue says that you will receive a 1099-G, you call and ask them why they say what they say on their website (see link above). Maybe it's another department in the City altogether.

[lviki]

I also received benefits of paid family leave for CA as part of child bonding leave. A part of it was paid by insurance and remaining portion was paid from CA PFL.

I  received 2 W2 from my insurance company Sedgwick 1 of which has box 14 filled mentioning CAPL.  I did not receive form 1099-G.  I called CA EDD and they mentioned they could not find any records  of form1099-G.

I have a letter from EDD which mentions that I will be receiving California Pail family benefits. 

I am not sure if I can get California tax exemption on this W2 with CAPL in box 14. Please suggest how to do it without form 1099-G

[KrisD15]

If the amount is reported in Box 14, that entry does not generate tax,

however you need to find out if you also have a 1099-G coming. 

Contact the insurer. Ask about the amounts you received.  Was it all paid through the insurer or also the state?

Box 14 does not report taxable income, taxable income would be on your W2 box 1.