Question

MN Paid Leave Employer Pickup

Forum|Forum|4 months ago
April 16, 2026
9 replies
140 views

I use QuickBooks Desktop. For MN Paid Leave Employer Pickup, I thought this should be taxable for State. It is not being included in my State Wage Base.

QuickBooks Desktop Payroll

J

Joemar_B

QuickBooks Team

Hi there, Tonik. Did you set up the employer-paid portion as a standard Company Contribution? If so, the software treats it as a non-taxable fringe benefit, which is why it isn't automatically increasing the employee's state taxable gross.

To fix this, Go to your Lists > Payroll Item List. Double click the MN Paid Leave item you created for the "Pickup." Then, the "Tax Tracking Type" must be set to a category to taxable benefit. This requires setting up a separate Addition item rather than just a Tax item if you want it to increase the wage base.

Note that you may need an offsetting Deduction (net zero to the check) if you are simply trying to report the taxability without giving the employee extra cash.

Here's the link for more information: Set up Minnesota Paid Family and Medical Leave

If you have any further questions, feel free to comment below. Your satisfaction is our top priority.

T

ToniKAuthor

No, it is showing up as a taxable fringe on the 941 and on the State Unemployment reports. This is how I set it up:

https://quickbooks.intuit.com/learn-support/en-us/help-article/family-leave/understand-tax-rules-paid-family-medical-leave/L3aanFBKy_US_en_US?uid=mo1lnt8z

C

continea

Level 5

Thank you for connecting with the QuickBooks Community and sharing that update. For Minnesota Paid Leave Employer Pickup, the employer-paid portion is considered taxable income to the employee, requiring it to be included in Federal, State (MN) Wage Base, and reported in Box 14 of the W-2. If it is appearing solely as a fringe benefit on the 941, the tax mapping in your QuickBooks Desktop is likely treating it as a non-taxable fringe rather than taxable imputed income. Let's double check to see the mapping:

Navigate to the Payroll Item List.
Edit the MN Paid Leave Employer Pickup payroll item.
Review the tax tracking type to ensure it is mapped to increase state taxable wages, not just Federal.
Ensure all payroll updates are installed.

Please keep me updated if this was the issue! See you soon!

Sign up

Login with SSO

Let's get you signed in

Login with SSO