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Incorrect Employee Percentage for WA State Paid Family & Medical Leave Act Tax

According to the WA State Employment Security Department, the tax Paid Family and Medical Leave Act tax on employees is 63.333% of the 0.4% tax.  The solution that QuickBooks has recently released to collect the PFMLA tax only allows for employers to input the tax rate as 63%.  This means that we will not collect the correct amount of taxes from the employee to remit to the state.  Additionally, the law is written so that it is not possible for employers to retroactively collect the correct tax amount.

 

What can be done so that employers can collect the full 63.333% starting on the 1/1/2019 payroll?

 

Please see bullet point 2 in the key details on https://paidleave.wa.gov/how-do-i-pay-premiums for the documentation.

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Anonymous
Not applicable

Incorrect Employee Percentage for WA State Paid Family & Medical Leave Act Tax

The state site you linked to is interesting.  It says:

"Employers who choose to withhold premiums from their employees may withhold up to 63.333% of the total premium. The employer is responsible for paying the other 37.667% and remitting total premiums to ESD on a quarterly basis starting April 2019."

 

This will be interesting, because 63.333% and 37.667% adds up to 101%.

It'll be loads of fun to watch you WA employers try to figure this one out.

 

It also says,

"Under the law, employers may split the cost of the program with employees by withholding up to 63.333% of the premium from their paychecks."

 

Maybe it's a display issue and QB internally will calculate it as you expect. 

If QB will only put 63% f the 0.4% against the employee you'll still be OK legally.

 

It's true you may not be able to hit your employees for that last .333% of .4%.

If you have more than 50 employee and a $2,000,000 annual payroll you'll be out $26.64.

 

If you have fewer than 50 employees it looks like you don't have to pay at all as a company.

Highlighted
Level 2

Incorrect Employee Percentage for WA State Paid Family & Medical Leave Act Tax

Quickbooks has been putting out incorrect information about the tax rates. I recently talked directly to the people at ESD running this Family Leave program and they told me how to correct the rates in Quickbooks. I suggest calling them directly to learn how to set up your QB correctly.

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