FLI on a New Jersey W-2 is the amount withheld from your paychecks for Family Leave Insurance, a state program that pays part of your wages when you take time off to bond with a new child or care for a seriously ill family member. It is not a tax you owe at filing time and it is not an error. It is your contribution to a benefit you can draw on later.
Where the FLI Amount Shows Up
Look in Box 14 of your W-2. That box is where employers report items that don’t fit the standard numbered boxes. FLI may appear on its own line, or it may be grouped with unemployment and workforce development withholdings under a combined label such as “UI/FLI.” The dollar figure is the total deducted across the whole calendar year.
Some employers put FLI contributions in Box 17 instead of Box 14. If the number in Box 17 looks larger than your state income tax should be, check whether FLI was folded in. The New Jersey Division of Taxation lists this as a common filing mistake, because FLI withholding is not state income tax and should not be reported that way on your NJ-1040.1NJ Division of Taxation. Common Filing Mistakes
How Much Was Withheld in 2026
For 2026, the employee contribution rate is 0.23% of covered wages, applied to the first $171,100 you earn. The most any single worker contributes in the year is $393.53.2Division of Temporary Disability and Family Leave Insurance. Employer Information Wages above $171,100 are not subject to the deduction, so higher earners stop contributing once they cross that ceiling.3Department of Labor & Workforce Development. NJ Department of Labor and Workforce Development Announces New Benefit Rates for 2026
The rate changes from year to year. In 2024 the employee rate was 0.00% because the fund had built up a surplus, and the FLI line could still appear on a W-2 even with no dollars withheld.4Department of Labor & Workforce Development. Rate Information, Contributions, and Due Dates For 2026 the rate is back to 0.23%, so an actual amount should appear.
What Your Contribution Pays For
Family Leave Insurance replaces part of your pay during qualifying unpaid leave. The program covers two situations: bonding with a new biological, adopted, or foster child, and caring for a family member with a serious health condition. It was established in 2009 under New Jersey’s Temporary Disability Benefits Law.5Justia. New Jersey Revised Statutes Section 43:21-25 – Short Title
“Family member” for care claims means a spouse, domestic partner, civil union partner, parent, or child. Child includes biological, adopted, foster, and stepchildren, and children of a domestic or civil union partner, if the child is under 19 or is 19 or older but unable to care for themselves due to a physical or mental condition.6NJ.gov. Your Guide to Family Leave Insurance in New Jersey
An approved claim pays 85% of your average weekly wage, up to a maximum of $1,119 per week in 2026.3Department of Labor & Workforce Development. NJ Department of Labor and Workforce Development Announces New Benefit Rates for 2026 You can collect up to 12 consecutive weeks in a 12-month period, or up to 56 individual days spread out if you take leave intermittently. You cannot collect FLI at the same time as temporary disability benefits, unemployment, or full paid leave from your employer.7Justia. New Jersey Code Section 43:21-39.1 – Compensation for Family Temporary Disability Leave, Conditions
One point worth knowing before you count on it: FLI pays you money, but it does not by itself guarantee your job will be there when you come back. Job protection comes from separate laws, the federal Family and Medical Leave Act and the New Jersey Family Leave Act, each with its own eligibility rules.8NJ Office of the Attorney General. Job-Protected Family Leave
How FLI Affects Your Tax Return
The FLI amount on your W-2 is not deductible on your federal return. It reduces your take-home pay but does not reduce your federal taxable income.
On the New Jersey side, do not add your FLI withholding to the state income tax you report on your NJ-1040. FLI is a separate program with a separate line, and treating it as state tax withheld is one of the mistakes the Division of Taxation flags.1NJ Division of Taxation. Common Filing Mistakes
If you ever receive FLI benefit payments, those are a different matter. Benefits are taxable at the federal level and the state issues a Form 1099-G through its online system showing the total paid to you. New Jersey does not tax the benefits, so you do not report them as income on your NJ-1040.9Division of Temporary Disability and Family Leave Insurance. Family Leave Insurance Federal tax is not withheld automatically from benefit checks, but you can request 10% withholding when you apply.10Internal Revenue Service. Instructions for Form 1099-G – Certain Government Payments
Getting a Refund if You Overpaid
If you worked for two or more New Jersey employers in 2026 and the FLI amounts on your W-2s add up to more than $393.53, you can recover the excess. File Form NJ-2450 with your New Jersey income tax return, attaching a copy of each W-2. The credit flows through to your NJ-1040.11NJ.gov. Form NJ-2450 Employee’s Claim for Credit for Excess UI/WF/SWF, Disability Insurance, and/or Family Leave Insurance Contributions
If a single employer withheld more than the annual maximum on its own, that is a payroll error. Ask that employer for the refund directly instead of filing NJ-2450. Spouses filing a joint New Jersey return each file a separate NJ-2450 for their own excess contributions.11NJ.gov. Form NJ-2450 Employee’s Claim for Credit for Excess UI/WF/SWF, Disability Insurance, and/or Family Leave Insurance Contributions