Set up Maryland Family and Medical Leave Insurance

by Intuit •

•

Updated 9/1/2026 11:45

Learn how to set up and manage Maryland Family and Medical Leave Insurance (FAMLI) contributions in QuickBooks Online Payroll and QuickBooks Desktop Payroll.

Maryland's Family and Medical Leave Insurance (FAMLI) program is a new state-required payroll tax that starts January 1, 2027. It gives employees paid time off for qualifying family and medical events. You can set up and manage these tax contributions for your covered employees in QuickBooks to help you stay compliant.

How the program works

Maryland FAMLI is administered separately from unemployment insurance (UI), and it has its own registration and remittance process through the state's FAMLI portal.

Registration: employer registration opens Fall 2026 at paidleave.maryland.gov. Registration is EIN-based — there's no separate paid-leave account number (unlike some other states). All entities under the same EIN register together.
Filing is separate from UI: MD FAMLI contributions and quarterly wage reports are filed through paidleave.maryland.gov, not combined with your UI account.
Private plan option: employers may apply for an approved Employer Private Insurance Plan (EPIP) instead of using the state plan. The submission window for the Declaration of Intent (DOI) is September 1, 2026 through November 15, 2026. Even with an EPIP, employers must submit quarterly wage and hour reports.
First contributions due: contributions begin January 1, 2027. The first quarterly payment and wage report are due April 30, 2027 (covering Q1 2027 wages).

How employer size is determined

Employer size determines contribution obligations. For 2027, size is recalculated each quarter based on that quarter's wage and hour report. From 2028 onward, size is determined by the average number of employees paid across the prior four reported quarters.

Who is covered?

Covered employees: any employee who works in a Maryland-localized position is covered, regardless of employment type — including full-time, part-time, seasonal, temporary, and AmeriCorps workers.
Remote workers: coverage is based on work location, not residence. An employee working remotely from Maryland (performing work in Maryland) is covered. An employee working remotely for a Maryland employer from another state is not covered.

The following workers aren't subject to MD FAMLI. They don't contribute to the fund and can't receive benefits:

Federal employees are explicitly excluded by law.
Independent contractors and self-employed individuals aren't automatically covered as W-2 employees.
Unemployed or retired individuals aren't covered, as FAMLI applies only to employees on leave from active employment.
Workers not localized in Maryland aren't covered, regardless of the employer's location.

Contribution rates and requirements

The confirmed 2027 FAMLI contribution rate is 0.90% of covered wages, effective January 1, 2027 through December 31, 2027, applied up to the Social Security Administration's wage base ($184,500 for 2026 — this adjusts annually and is announced by the SSA each fall for the following year). There's no employee opt-out. Participation is mandatory for all covered Maryland workers.

The rate is split differently depending on your employer size:

Employer size	Total contribution rate	Employer pays	Employee pays (max)
Large employers (15 or more employees)	0.90%	At least 0.45%	Up to 0.45%
Small employers (fewer than 15 employees)	0.45%	$0 (exempt from employer share)	Up to 0.45%

Employers of any size may voluntarily cover more than their required share, including paying the full contribution on behalf of their employees.

Note If you pay the employee's share, those pick-up contributions are treated as taxable wages and must appear on the employee's W-2 (per IRS Notice 2026-6).

Private plans

You can offer a private Employer Private Insurance Plan (EPIP) instead of participating in the state plan. Your private plan must meet or exceed the coverage requirements set by the state. If you have an approved EPIP, enter zero contribution rates — however, you're still required to submit quarterly wage and hour reports and claims data through paidleave.maryland.gov.

Find out more about Maryland Family and Medical Leave Insurance: https://paidleave.maryland.gov

Set up the FAMLI tax

Note Coming soon: product setup steps for QuickBooks Online Payroll and QuickBooks Desktop Payroll will be available before the January 1, 2027 contribution start date. Check back here for step-by-step instructions.

Edit or update MD FAMLI

Note Coming soon: steps for editing contribution rates and updating employee settings will be available before January 1, 2027.

Exempt employees from MD FAMLI

MD FAMLI participation is mandatory for all covered Maryland workers; there's no general employee opt-out. However, certain workers are legally exempt from the program (see "Who is covered?"), including federal employees.

Note Coming soon: steps for handling exempt employees, including federal employees, will be available before January 1, 2027.