March 18, 2025

In the Spotlight: What to know about FAMLI and federal taxes

Curious or concerned about how your FAMLI benefits will be taxed? Here are the big takeaways for claimants trying to make sense of it all:

Colorado does not tax FAMLI benefits.
While the FAMLI Division can’t offer tax advice, this recent report lays out what claimants need to know about FAMLI and federal taxes. FAMLI claimants can now choose whether they’d like the FAMLI Division to withhold federal income tax from their benefits. This is a simple opt-in or opt-out option. If you opt in, the rate for FAMLI withholdings is a flat 10%. Review the Tax Withholding chapter in the My FAMLI+ User Guide for step-by-step instructions!

What to expect if your employer decides to stop using a private plan for FAMLI coverage

Your employer is required to notify you at least 30 days before terminating any private plan they’re using for FAMLI coverage. There should be no gap in coverage for you, the employee.

If you’re in the middle of a continuous paid family or medical leave claim during the transition, you’ll finish your leave using the employer’s private plan.

For more information, contact your Human Resources department, and visit the FAMLI webpage about private plans!

People are asking: What happens to FAMLI benefits if I switch employers?

Before filing for FAMLI benefits, workers must meet eligibility requirements, including earning $2,500 in total wages within Colorado during either the first four of the last five completed calendar quarters, or the last four completed calendar quarters.

Although there is no requirement to work at a job for a certain length of time, if you switch employers and want to use your FAMLI benefits, you may need to submit proof of wages if your new employer has not yet submitted wage reports for you.

In addition, most employees are eligible for job protection after they have worked for their employer for 180 days.

Share Your Story

“As a grieving mother, my mental (and) emotional well-being should be a priority, but bills don't stop; the world doesn't stop. As I am slowly trying to adjust to this new life without my child, (FAMLI) gives me the flexibility to be able to take care of my mental health needs as I slowly get back to work life.”

That’s from Delilah in Fort Morgan, who used FAMLI leave to care for her own health after losing a child.

We want to hear your personal stories, too! Please tell us how FAMLI is helping you through a significant life event. Each month we’ll feature real stories in this newsletter.

You can check more real FAMLI journeys on our website and submit your own, too!

Let’s Get Social!

FAMLI is now on INSTA! Be sure to follow us and engage with the account at @coloradofamli. And don’t forget, we’re also on Facebook, Twitter, and LinkedIn.

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Colorado Division of Family and Medical Leave Insurance (FAMLI)

633 17th Street, Denver, CO 80202-3660

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