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Set up Connecticut Paid Family Leave

SOLVEDby QuickBooks71Updated 1 month ago

Learn how to set up your payroll to track the paid family leave in Connecticut.

The state of Connecticut has implemented a new standalone Paid Family Leave program funded by the collection of taxes from the employee. If you have full service payroll, we'll pay and file this tax for you.

For more information visit Connecticut's Paid Family Leave site.

How the Connecticut Paid Family Leave program works

  • The tax rate is 0.5% of employee taxable wages up to the Social Security (SS) limit.
  • All Connecticut based employers are required to collect this tax from their employees. In order to be exempt from the tax, employers must apply and receive permission from the Connecticut Paid Leave Authority to provide a private plan to its employees.

Add Connecticut Paid Family Leave to employees

To begin the calculation and deduction of Connecticut Paid Family and Medical leave from your employee’s pay you will need to update your payroll.

Note: Not sure which payroll service you have? Here's how to find your payroll service.

Add the rate in your company tax settings.

  1. Go to Settings ⚙ and select Payroll settings.
  2. Next to Connecticut Paid Family and Medical Leave select the dropdown menu and choose 0.5%.
    • Note: If you have received a waiver from withholding this rate for all employees from the Connecticut Paid Family and Medical Leave Agency you'll need to choose the rate of 0%.
  3. Enter the Effective date.
  4. Select OK to save.

Taxes will deduct from your employees paychecks on the effective date.

If you have already run paychecks prior to setting up this rate, the employee will have any catch-up amounts deducted from their next paycheck.

Download and install the latest payroll update, When you add a new or an employee that is subject to CT Paid Family leave, the tax will appear on the Other tab in the Taxes window.  

Important: If you’re asked this rate is part of the UI rate, select No. The tool will create two new payroll items related to the CT tax.

Verify the tax was added for each employee:

  1. Go to Employees and select Employee Center.
  2. Double-click the employee's name to open the Edit Employee window.
  3. Select the Payroll Info tab and select Taxes.
  4. In the Taxes screen that pops up, select the Other tab.
  5. Verify the CT Paid Leave line is there.

Add your account number or update your rate for this tax. 

  1. Go to Lists then Payroll Item List.
  2. Double-click the payroll item called CT Paid Leave.
  3. Select Next until the until you get to the Enter the number that identifies you to the agency window,  and enter your FEIN.
  4. Select Next.
  5. Enter 0.5 in the Employee tax rate window.  If your company has been provisional approved for an exemption (private plan), enter 0.
  6. Select Next until you can select Finish.

If you have already run paychecks prior to setting up this payroll item, the employee will have any catch-up amounts deducted from their next paycheck.

Exempt an employee from Connecticut Paid Family Leave

If an employee is exempt from Connecticut Paid Family and Medical Leave, mark them as exempt so premiums won't calculate on their paychecks.

  1. Go to Payroll, then Employees.
  2. Select your employee.
  3. From Tax withholding, select Edit.
  4. In the Tax Exemptions section, select CT Paid Family and Medical Leave.
  5. Select Save.
    If you have already created paychecks prior to exempting the employee, contact us to help you correct any previously created checks.

QuickBooks Desktop Payroll Assisted: contact us to remove this tax.

QuickBooks Desktop Payroll (all other versions):

  1. Go to Employees and select Employee Center.
  2. Double-click the employee's name to open the Edit Employee window.
  3. Go to the Payroll Info tab and select Taxes.
  4. In the Taxes screen that pops up, select the Other tab.
  5. Select the CT Paid Leave line and select Delete.
  6. Select OK twice.

If you have already created paychecks prior to exempting the employee you will need to do a liability adjustment to correct QuickBooks Desktop. To pay the employee back the amount collected create a reimbursement item and add it to the next paycheck.

Amendments to filings may be needed if you have crossed quarters. If you have QuickBooks Desktop Payroll Assisted contact us for support.

Edit, remove, or delete Connecticut Paid Family Leave

Edit your policy

  1. Go to Settings ⚙, and select Payroll settings.
  2. From Connecticut tax, select Edit ✎.
  3. Under CT - Paid Leave, select Edit next to the policy you want to edit. 
  4. Edit the rate, then select Save.
  5. Select Save, then Done.

Edit or change your rate or account number

  1. Go to Lists, then select Payroll Item List.
  2. Double-click the CT - Paid Leave item.
  3. Select Next until you get to the Agency for company-paid liability screen.  
  4. Enter or edit your account number. 
  5. Select Next.
  6. Verify or change your rate.
  7. Select Next, then select Finish.

Delete Connecticut Paid leave from your employee

  1. Go to Employees, and select Employee Center.
  2. Double-click your employee.
  3. Select Payroll Info
  4. Select Taxes, then Other.
  5. Select CT - Paid Leave, then Delete.
  6. Select OK, then Save & Close.

Frequently Asked Questions (FAQ)

It does not matter whether an employee is salaried, hourly, full-time, or part-time. In order to be eligible for paid leave benefits from the Connecticut Paid Leave Authority, the employee must meet both of the following requirements:

  • The individual is currently employed in Connecticut or has been employed within the last 12 weeks in Connecticut by an employer who has not obtained permission to have a private plan; and
  • The individual has earned at least $2,325 in one quarter within 15 months starting 1/1/2021.
    In addition, self-employed or sole proprietors who have chosen to enroll (for a minimum of 3 years) in the Connecticut Paid Leave Authority may be eligible for benefits.

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