New York employers withhold progressive state income tax, pay unemployment insurance on the first $12,800 of wages (2025), and collect a 0.388% Paid Family Leave contribution capped at $354.53 for 2025. NYC, Yonkers and MCTMT taxes may also apply.
Source last updated: 09/16/2025.
Overview
New York State has a progressive individual income tax, employer unemployment insurance (UI) obligations with an annual UI wage base, state-mandated paid sick leave, and a state Paid Family Leave (PFL) program funded by employee payroll contributions. Employers operating in New York must also consider local taxes and assessments - New York City and Yonkers resident taxes, and the Metropolitan Commuter Transportation Mobility Tax (MCTMT) - when applicable.
State tax requirements at a glance
| Item | New York requirement |
|---|
| Individual income tax | Progressive rates. Employers must withhold NYS personal income tax from wages of employees who work or reside in the state, following NYS withholding tables and forms |
| UI wage base (effective 1/1/2025) | $12,800 per employee |
| UI filing | File NYS-45 and remit UI contributions per NYSDOL instructions |
| PFL employee contribution (2025) | 0.388% of gross wages per pay period, with an annual cap of $354.53 |
| New hire reporting | Within 20 calendar days of hire, to the NY New Hire Reporting Center |
| Withholding certificates | IT-2104 / IT-2104.1, kept with employer records |
Unemployment insurance (UI / SUTA)
Employers pay UI contributions on each employee's wages up to the annual UI wage base. NYSDOL publishes experience-rating tables and employer contribution rate notices; new-employer and experience-rated rates vary, with the new-employer normal rate capped per statute. See NYSDOL for your current assigned rate.
Paid Family Leave (PFL)
New York PFL is an employee-funded insurance program collected through payroll. Employers must collect contributions and follow PFL filing and record rules. Employers may choose to pay the contribution on employees' behalf but are not required to.
State Disability Benefits (DBL)
Employers who meet the coverage thresholds must provide Disability Benefits (DBL). Employers are permitted, but not required, to collect employee contributions to help fund DBL, with employee contribution rules limited to statutory maxima. See NY Workers' Compensation Board guidance for employer responsibilities.
Withholding and wage reporting
Use New York withholding forms and tax tables (IT-2104 and IT-2104.1, plus the NY withholding publications) to calculate state and, where applicable, NYC or Yonkers withholding amounts. Keep NY withholding certificates with employer records.
Local tax requirements
New York City and Yonkers: residents of NYC or Yonkers have additional local resident income taxes and surcharges, with their own withholding rules. Employers must withhold NYC or Yonkers taxes when applicable and follow the state instructions for calculating city withholding.
MCTMT (Metropolitan Commuter Transportation Mobility Tax): employers with aggregate payroll expense in the Metropolitan Commuter Transportation District (MCTD) above the quarterly threshold - more than $312,500 in the MCTD in a calendar quarter - may be subject to the MCTMT, and must register, calculate and file MCTMT returns if liable. The MCTD is split into zones for rate calculation: Zone 1 is the NYC boroughs, and Zone 2 is certain surrounding counties.
Paid sick leave
New York's statewide paid sick leave law requires employers to provide paid sick leave based on employer size and net income.
| Employer size | Paid sick leave per year |
|---|
| 100 or more employees | Up to 56 hours |
| 5 to 99 employees | Up to 40 hours |
| 4 or fewer employees with net income over $1M in the prior tax year | Up to 40 hours |
Employers may front-load or allow accrual, and must follow posting and notice rules and keep records. Cities and counties may have additional rules, so check local ordinances for employees in New York City and other municipalities.
Overtime
New York employers must comply with the federal FLSA and New York Labor Law (NYLL). Generally, nonexempt employees are due time-and-a-half for hours worked over 40 in a workweek. New York may have specific orders or exemptions for certain industries and categories, so check the NY DOL overtime FAQ and Minimum Wage Orders for industry-specific rules. Some categories - executive, administrative, professional, outside sales, and certain farm and domestic workers - may be exempt under state and federal tests. New rules phased in for farm worker overtime; check NYSDOL for implementation details.
Rest and meal breaks
New York law does not generally require paid meal breaks for private-sector employees, but employers must follow any sector-specific rules. Short rest periods, typically around 20 minutes, are compensable. Follow NY DOL guidance and company policy.
Final pay and pay frequency
Employers must pay final wages according to New York law. Generally, final wages are due on the next regular payday for employees who quit, while discharged employees are typically entitled to wages at the time of discharge or by the next regular payday depending on the circumstances. Confirm with NY DOL and consult the NY Labor Law for specific timing and notice requirements.
Minimum age and tips
- Employment age: New York requires working papers for youth age 14 to 17 and has specific hour and occupation limits by age. Employers must follow the NY child labor rules for permitted hours and work types.
- Tips: New York does not establish a separate minimum age for earning tips beyond the state child-labor rules. Tipped earnings are reportable and subject to withholding the same as other wages, and tipping-specific rules follow federal FLSA guidance plus New York rules for minimum wage and tipped-employee treatment.
State-mandated retirement and auto-enrollment
New York has promoted retirement initiatives, such as programs for private-sector automatic IRAs at various stages. Employers should monitor Department of Financial Services and New York State guidance for any mandatory payroll-deduct auto-enrollment obligations, and verify the current status before assuming mandatory employer obligations.
Wage deductions and garnishments
Employers must follow New York wage deduction rules and federal garnishment limits. Voluntary deductions require proper written authorization. Child support and court-ordered garnishments must be honored per state and federal procedures. See NYS guidance for forms and procedures.
Recordkeeping and notices
Maintain payroll, time and tax records per NY Labor Law and federal FLSA requirements. Post required state and local notices, including minimum wage, paid sick leave, PFL and DBL notices, and unemployment, and retain documentation per statutory retention periods.
Compliance updates
| Item | 2025 update |
|---|
| UI wage base | Effective 1/1/2025 the NYS UI taxable wage base is $12,800. Use the 2025 wage base and check NYSDOL publications and experience rate notices for exact employer rates. |
| PFL employee contribution | For 2025 the employee contribution rate is 0.388%, with an annual cap of $354.53. Employers must implement payroll collection unless they elect to cover the cost. |
| Paid sick leave | Effective guidance remains: employers must provide sick leave based on employer size and prior-year net income thresholds. |
Resources and references
- NYS Department of Taxation and Finance - individuals, withholding, and NYC and Yonkers information.
- NYS Department of Labor (NYSDOL) - Unemployment Insurance and employer filing (NYS-45) and experience rates.
- New York State - New York Paid Sick Leave official page.
- New York State Paid Family Leave - employer guidance and 2025 rates.
- NYS Workers' Compensation Board - Disability Benefits (DBL) and employer responsibilities.
- NYS employment of minors and child labor guidance - working papers and age limits.
- NYS MCTMT employer guidance from the Tax Department.
Frequently asked questions
What is New York's unemployment insurance wage base?
Effective January 1, 2025, the New York State UI wage base is $12,800 per employee. Employers pay UI contributions on wages up to that base, file Form NYS-45, and remit contributions per NYSDOL instructions; experience-rated and new-employer rates vary.
How much do New York employees contribute to Paid Family Leave?
New York PFL is employee-funded through payroll. For 2025 the employee contribution is 0.388% of gross wages per pay period, subject to an annual cap of $354.53. Employers must collect the contributions, and may choose to pay them on employees' behalf but are not required to.
How much paid sick leave does New York require?
New York's statewide paid sick leave requirement depends on employer size and net income: employers with 100 or more employees must provide up to 56 hours per year; employers with 5 to 99 employees up to 40 hours per year; and employers with 4 or fewer employees whose prior-year net income exceeded $1 million up to 40 hours per year.
What is the MCTMT and which employers owe it?
The Metropolitan Commuter Transportation Mobility Tax applies to employers whose aggregate payroll expense in the Metropolitan Commuter Transportation District exceeds $312,500 in a calendar quarter. Liable employers must register, calculate and file MCTMT returns, and the district is split into zones for rate calculation, with Zone 1 covering the New York City boroughs and Zone 2 certain surrounding counties.
How quickly must New York employers report new hires?
Employers must report new hires and rehired employees working in New York to the NY New Hire Reporting Center within 20 calendar days of hire. Electronic reporting options are available.
