Out-of-state employees and your Maryland FAMLI rate

Maryland FAMLI counts employer size across every state under one federal EIN, but calculates contributions only on wages for work localized in Maryland. Your quarterly report has to state the out-of-state headcount, and leaving that field blank means you are treated as not small and pay double.

This page is about Maryland FAMLI, administered by the Maryland Department of Labor, FAMLI Division. Colorado runs a separate paid leave program with the same name and different rules; nothing here applies to it.

The calculator asks for both numbers separately, and warns you the moment your EIN headcount and your Maryland headcount put you on the wrong side of the line.

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Two different numbers, doing two different jobs

Maryland FAMLI asks employers for two headcounts, and they are not interchangeable.

  1. Employees whose work is localized in Maryland. This is the group whose wages contributions are calculated on.
  2. Total employees under the same federal EIN, in every state. This is the number that decides whether you are a small employer or not. COMAR 09.42.02.06A

Mixing them up costs money in both directions. An employer that reports only its Maryland staff as its size may claim a small-employer rate it is not entitled to. An employer that never tells the Department how many people it has outside Maryland loses a small-employer rate it is entitled to.

The blank field

To be classified as small, your quarterly wage report has to state how many of your employees work outside Maryland. COMAR 09.42.02.08C and D Leave that field empty and you are treated as not small, and you pay 0.9 percent instead of 0.45 percent.

No penalty, no notice, no correspondence. A blank field, and the rate doubles.

This is the one thing on this site most likely to cost a reader real money, which is why the calculator raises it as a warning rather than a footnote whenever your EIN headcount is higher than your Maryland headcount and you are inside the small band.

What “localized in Maryland” means in practice

Contributions are due on wages paid for qualified employment, which is work localized in Maryland. A fully remote employee living and working in Baltimore for a Denver company is a Maryland employee. A Maryland-headquartered company's salesperson who lives and works in Pennsylvania is not. Independent contractors are not employees for this purpose in either direction.

Edge cases (employees who split their time across state lines, employees seconded for part of the year, staffing arrangements where two entities could each be the employer) are genuinely hard, and neither this page nor the calculator resolves them. Ask FAMLI Customer Care on (410) 525-4010, and get the answer in writing.

Two worked examples, same Maryland payroll

Both firms below employ 10 people in Maryland and pay them $750,000 a year between them. Only the out-of-state headcount differs.

Firm A: 10 in Maryland, 30 elsewhere, 40 under one EIN

What was entered
Employees working in Maryland10
Total employees under one EIN40
Annual Maryland payroll$750,000
Payroll frequencyMonthly
What the calculator returns
BandStandard, 15 or more under the EIN
Rate applied0.90%
Employer share, full year 2027$3,375.00
Employee share, full year 2027$3,375.00
Total for 2027$6,750.00
Extra cost of the out-of-state headcount$3,375.00 a year

Computed by famliclock.com from the published 2027 rate of 0.9 percent and the 2026 Social Security taxable maximum of $184,500, on 21 September 2026. Wages are assumed to be spread evenly across the headcount, which produces the largest figure the employer could owe. These are estimates, not a filing.

Firm B: 10 in Maryland, 2 elsewhere, 12 under one EIN

What was entered
Employees working in Maryland10
Total employees under one EIN12
Annual Maryland payroll$750,000
Payroll frequencyMonthly
What the calculator returns
BandSmall employer, under 15
Rate applied0.45%
Employer share, full year 2027$0.00
Employee share, full year 2027$3,375.00
Total for 2027$3,375.00
If the out-of-state headcount field is left blank$3,375.00 more a year

Computed by famliclock.com from the published 2027 rate of 0.9 percent and the 2026 Social Security taxable maximum of $184,500, on 21 September 2026. Wages are assumed to be spread evenly across the headcount, which produces the largest figure the employer could owe. These are estimates, not a filing.

The Maryland payroll is identical. The bill is not. The only variable is a headcount in another state.

And the third case, which is the expensive one

Take the second firm, the one entitled to the small-employer rate at $3,375.00 a year, and leave the out-of-state headcount field blank on its quarterly report. It is deemed not small and pays 0.9 percent: $3,375.00 more a year, for an empty box.

What to do about it

Questions

Do out-of-state employees count toward the Maryland FAMLI 15-employee threshold?

Yes. Employer size is total headcount under the same federal EIN, inside and outside Maryland. Contributions themselves are calculated only on wages for work localized in Maryland.

What happens if I do not report my out-of-state headcount?

To be classified small, your quarterly wage report must state how many employees work outside Maryland. If it does not, you are deemed not small and pay 0.9 percent instead of 0.45 percent.

Are remote employees living in Maryland covered by Maryland FAMLI?

An employee whose work is localized in Maryland is covered, including a remote worker living and working in Maryland for an out-of-state company. Contractors are not employees for this purpose.

Sources

  1. COMAR 09.42.02, employer size and quarterly reporting: https://regs.maryland.gov/us/md/exec/comar/09.42/index.full.html
  2. Maryland Department of Labor, Make Contributions: https://paidleave.maryland.gov/employers/make-contributions/
  3. Maryland Department of Labor, for employers: https://paidleave.maryland.gov/employers/

Rates and dates last verified against these sources on 21 September 2026. Where this page and the Maryland Department of Labor disagree, the Department is right and this page is wrong; tell us at hello@02launch.com and a dedicated engineer fixes it within 6 hours.

Who made this

Our team at 02Launch.com finds creative ways to use AI to drastically reduce your workload. We built this calculator because the FAMLI rules are spread across five COMAR chapters and nobody had put them in one place.

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