Key figures
New York payroll
2026, with sources
Registration and the quarterly return
New York runs withholding and unemployment insurance through one registration and one quarterly return. A new employer registers with the Department of Labor for UI and with Taxation and Finance for withholding, then files Form NYS-45, the combined withholding, wage reporting and UI return, on April 30, July 31, October 31 and January 31, even in a quarter with no payroll. Withholding itself is remitted on Form NYS-1 on a schedule set by how much is withheld.
Withholding covers more than the state. Employers withhold New York City personal income tax for city residents and Yonkers tax under its own rules, so an employee who lives in Brooklyn and one who lives in Jersey City, working side by side, have different withholding.
The 2026 UI wage base jumped to $17,600, from $12,800 in 2025, because the 2025 budget tied it permanently to 18% of the state average annual wage. New employers pay 4.1% in 2026 (4.025% UI plus 0.075% for the Re-employment Services Fund), about $722 per employee who earns at least the wage base.
Disability, Paid Family Leave and the MCTMT
New York is one of the few states where disability and paid family leave are insurance the employer buys, not a tax it remits. A company becomes a covered employer four weeks after it has had at least one employee on 30 days in a calendar year, and must then carry a DBL and PFL policy from a carrier, the State Insurance Fund, or a Board-approved plan. Employees may be charged 0.5% of wages, capped at $0.60 a week, for DBL, and 0.432% of gross wages, capped at $411.91 for the year, for PFL in 2026. The PFL benefit is up to 12 weeks at 67% of pay, capped at $1,228.53 a week.
The Metropolitan Commuter Transportation Mobility Tax is an employer-only payroll tax in the twelve-county district. It starts when payroll expense for covered employees exceeds $312,500 in a quarter; above $437,500 the rate is 0.60% in New York City and 0.34% in the suburban counties, rising to 0.895% and 0.635% on payroll over $2.5 million. It is filed on Form MTA-305 with no extensions.
Wages, leave and paydays
New York City amended its sick leave law, now called the Protected Time Off Law, effective February 22, 2026: on top of the paid hours, every employee gets 32 hours of unpaid protected time off from the start of employment, and employers must give the updated Notice of Employee Rights. New hires, and contractors with contracts over $2,500, are reported within 20 calendar days.
- Minimum wage: $17.00 an hour in NYC, Long Island and Westchester; $16.00 elsewhere. The Department of Labor says neither rises on January 1, 2027.
- State paid sick leave: 40 hours paid for 5–99 employees, 56 hours for 100+; under 5 employees it is paid only if net income exceeds $1 million.
- NYC: 40 or 56 hours of paid protected time off, plus 32 hours of unpaid protected time off available from the first day, plus 20 hours of paid prenatal leave.
- Pay frequency: manual workers weekly; clerical and other workers at least semi-monthly, on regular paydays set in advance.
- Final pay: no later than the regular payday for the pay period in which employment ended.
Deadlines
- Apr 30, Jul 31, Oct 31, Jan 31Combined withholding, wage reporting and UI returnForm NYS-45
- Apr 30, Jul 31, Oct 31, Jan 31MCTMT return, once payroll in the district exceeds $312,500 in a quarterForm MTA-305
- Within 20 calendar days of hireNew-hire report (employees and contractors over $2,500)
The federal baseline
This page covers what New York adds. The federal rules underneath it apply here too.
Common questions
Our payroll provider handles taxes. Does that cover disability and Paid Family Leave?
Yes, separately. New York requires disability benefits (DBL) and Paid Family Leave coverage in addition to workers’ compensation. Both are bought from an insurance carrier (or the State Insurance Fund), not paid to a state agency, and a company becomes a covered employer four weeks after it has had at least one employee on 30 days in a calendar year.
Do we owe the MCTMT on our first few salaries?
Only above a threshold. The MCTMT applies when an employer’s payroll expense for covered employees in the district exceeds $312,500 in a calendar quarter. A seven-person startup in Manhattan paying $150,000 a quarter is below it; at roughly twelve people on $120,000 salaries it crosses.
Do we withhold NYC income tax?
If they live there. New York employers withhold New York City personal income tax for employees who are city residents, and Yonkers tax under its own rules, on the same NYS-45 as state withholding.
Payroll next door
- CTConnecticut payrollConnecticut payroll means a $27,000 wage base, CT Paid Leave at 0.5% from the first employee, weekly paydays by default, and paid sick leave reaching every employer in 2027.
- MAMassachusetts payrollMassachusetts payroll runs through DOR, DUA and DFML: 5% withholding, a $15,000 UI wage base at 2.42% for new employers, PFML at 0.88% (0.46% under 25), and final pay on the last day.
- NJNew Jersey payrollNew Jersey runs its own disability and family leave insurance through payroll: in 2026 employees pay 0.19% TDI and 0.23% FLI up to $171,100, and the UI wage base is $44,800. Jersey City and Newark add a 1% employer payroll tax.
- PAPennsylvania payrollPennsylvania’s state payroll is light: 3.07% flat withholding and UC on the first $10,000. The work is local: earned income tax under Act 32, the Local Services Tax, and Philadelphia’s 3.735% Wage Tax.
- VTVermont payrollVermont payroll is withholding plus a 0.44% Child Care Contribution, a $15,400 UI wage base at 1% for new employers, weekly paydays by default and final pay within 72 hours of a discharge.
How New York compares
- No tax on wagesStates with no state income tax on wagesNew York: withholds state income tax. 9 of 51 states are on the list.
- Paid leave payrollStates with a paid leave or disability payroll programNew York: state paid leave or disability program. 16 of 51 states are on the list.
- Local payroll taxStates with city, county or district payroll taxesNew York: city, county or district taxes on wages. 14 of 51 states are on the list.
Founder guides on this
- PeopleContractor or employee? Classification for startupsContractor or employee depends on control, not the contract. The IRS test, state rules, 1099s, payroll registration and the cost of getting it wrong.
- EquityStock options, 409A valuations and vesting for startupsHow option strike prices are set by a 409A valuation, how vesting and the cliff work, and why ASC 718 makes every grant an expense on your P&L.
- RunwayBurn rate and runway: how to calculate them correctlyGross burn, net burn and months of runway, done the way an investor checks them: from cash, averaged, and with the hires you’ve already committed to.
More of the New York guide
- AccountingAccounting and state tax in New YorkCorporate tax, conformity to federal rules, apportionment and what it does to your books
- ReceivablesReceivables and sales tax in New YorkSales tax registration, economic nexus, whether SaaS is taxable, and collecting from customers
- PayablesPayables and contractors in New YorkPaying vendors and contractors: 1099 filing, use tax, contractor tests and withholding
- ComplianceCompliance and filings in New YorkRegistering to do business, annual reports, franchise tax and the filing calendar
- AdvisoryAdvisory: credits and decisions in New YorkCredits, incentives and the decisions that are cheaper to get right the first time
Sources
Checked against each agency’s own page on . Rates and thresholds change, usually on January 1.
- NYS Department of Labor — NYS-45 quarterly reporting and UI wage base
- NYS Department of Labor — Unemployment insurance rate information
- New York State Paid Family Leave — 2026 updates
- NYS Workers’ Compensation Board — Disability benefits for employers
- NYS Department of Labor — Minimum wage
- NYS Department of Taxation and Finance — MCTMT for employers
- NYS Department of Taxation and Finance — NYS-50-T-NYS, 2026 withholding tables and methods
- NYS Department of Taxation and Finance — New hire reporting
- NYC Department of Consumer and Worker Protection — Protected Time Off Law
General information for US companies, not tax, legal or accounting advice for yours. Rules and thresholds change; confirm the specifics with a CPA or the agency before you act on them.