July 24, 2019
In 2018, Massachusetts signed into law a statute that provides paid family and medical leave (PFML) benefits to all Massachusetts workers. This new law establishes a system for paid family leave of up to 12 weeks to care for a family member, and up to 20 weeks for your own illness.
The tax will begin in on October 1, 2019.
All Massachusetts employers that employ one or more Massachusetts workers, including contractors and “gig economy” employers.
Here are some of the most frequently asked questions we’ve been receiving about the new PFML law:
Q: My company does not run payroll but I pay subcontractors, does this law apply to me?
A: Yes! Because you have 0 employees and pay x number of subs, your subs are considered “covered individuals”. Because that makes up more than 50% of your payroll you are required to collect and pay in tax on their behalf.
Q: How do I determine which subs need to be paid?
A: Collect W-9s for each sub to determine their entity type. You only need to collect tax for Sole Proprietors.
Q: How do I pay in the tax?
A: STOP! CONTACT YOUR PAYROLL PROVIDOR. We do NOT advise that you attempt to collect the tax yourself. Not only are you risking serious tax penalties if you do not set yourself up correctly, but you are also putting 100% liability on yourself. If you do not have a payroll provider, give us a call!
As a reminder, employers must notify their official MA PFML poster and have your employees (and subs!) sign forms stating that they have received this information from you.
Still confused? Attend one of our upcoming information sessions to ask questions and learn more:
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