A Breakdown of D.C.’s Paid Family Leave Tax Rate Increase
On July 1, 2024, the District of Columbia permanently increased the Paid Family Leave (PFL) tax rate from 0.26% to 0.75% of the wages paid to each covered employee. Here is a breakdown of the tax change and how it could impact your organization.
Background
In July 2022, Washington, D.C. increased its Paid Family Leave (PFL) tax rate from 0.26% to 0.75% to expand the scope of the D.C. Paid Family Leave benefits program. On July 1, 2024, D.C. made that change permanent.
Who Does It Affect?
This update impacts any organization that employs people who physically work in D.C. If your organization has employees working in Washington D.C., then the mandatory Paid Family Leave (PFL) taxes that your organization is already paying for them will be increasing from 0.26% to 0.75% of the wages paid to them.
Deadlines
Washington D.C. Paid Family Leave (PFL) 2024 Quarterly Tax Rate and Due Dates
If you pay your organization’s D.C. taxes quarterly, then the quarterly tax payment due on October 31 will be at the increased rate.
| Quarter | Tax | Quarter Dates | PFL Tax Due Date |
|---|---|---|---|
| Quarter 1 | 0.26%, 0.0026 | 1/1 – 3/31/2024 | 4/30/24 |
| Quarter 2 | 0.26%, 0.0026 | 4/1 – 6/30/24 | 7/31/24 |
| Quarter 3 | 0.75%, 0.0075 | 7/1 – 9/30/24 | 10/31/24 |
| Quarter 4 | 0.75%, 0.0075 | 10/1 – 12/31/24 | 1/31/25 |
Washington D.C. 2024 Paid Family Leave (PFL) Annual Tax Rate Due Date
Employers that report wages to the Office of Unemployment Compensation (OUC) annually are also permitted to pay the PFL tax annually. The next wage report and tax payment are due to OUC and PFL by April 15, 2025.
ESSP
Annual Filers that utilize the Employer Self-Service Portal (ESSP) do not need to prepare for the tax rate change as ESSP will automatically calculate the PFL tax owed at the new 0.75% rate when a wage report is submitted. This applies to employers, third-party administrators, and PFL-enrolled self-employed individuals who use the ESSP to file wage reports.
Questions
Have questions about the Paid Family Leave (PFL) tax rate update or how it may impact your organization? Our team of business advisory and HR experts is here to help. Contact Us.