Self-employed individuals are also eligible to take FAMLI leave. Those who are self-employed must live and work in Colorado and must opt in to coverage and agree to pay premiums (0.45% of wages) for a minimum of three years.
Those who want to voluntarily participate must register with the FAMLI Division via My FAMLI+ Employer, the portal employers use to report quarterly wages and pay premiums, in order to commit to three years of participation. Self-employed workers must be registered in My FAMLI+ Employer before they can apply for FAMLI benefits.
Self-employed workers will need to provide their most recent tax transcript from the IRS. This should include four quarters of their gross income from self-employment. If their tax transcript does not include gross income from self employment, then they may have to submit invoices, payment records and bank records, so that the FAMLI Division can verify their income.
While there is no open enrollment period, you will need one quarter of coverage before you can collect FAMLI benefit payments. When registering in My FAMLI+ Employer, you may elect a retroactive coverage period, so you can apply for FAMLI leave. If you elect a retroactive coverage period, your first premium payment will be due on the next quarterly reporting deadline for employers (the last day of the month following the end of quarter: January 31, April 30, July 31, October 31).
Self-employed individuals who do not wish to participate in FAMLI do not need to take any action to opt out of the program. Simply don’t do anything.
If you are a sole proprietor, or an owner of a family business that does not have any employees, or you use an S-Corp business structure and are still unsure whether you qualify as self-employed or as an employer, here are some things to know:
- The structure of a business isn’t what matters for FAMLI compliance. What matters is whether the business has qualifying employees.
- If you have at least one qualifying employee, you will need to register with the Division, submit wage data, and send in premiums on behalf of that employee.
- Not sure whether a relative, fellow owner or business partner counts as an “employee”? Under the FAMLI Act, an “employee” is any individual, including a migratory laborer, performing labor or services for the benefit of another, irrespective of whether the common-law relationship of master and servant exists. The FAMLI Act’s definition of “employee” includes a two-part exception:
If a person is both primarily free from control in the performance of their work, and that work is part of their independent profession or trade, then that person is not an employee, and payments to them would not be subject to premiums. §8-13.3-503 (7) C.R.S.Individuals who meet this exception would be considered “self-employed,” and their participation in FAMLI is optional.