08 May 2018 New York law requires that employers report withholding tax detail by employee on a quarterly basis Effective with the first quarter of 2019, recently enacted New York State 2018-19 Fiscal Year budget bill requires that employers report withholding tax information per employee on a quarterly basis, effective first quarter 2019 (report due April 30, 2019). (S7509-C/A9509-C, Part I). Currently, employers report quarterly state unemployment insurance (SUI) detail to the New York State Department of Taxation and Finance that includes each employee's name, Social Security number and taxable wages. On an annual basis, on the fourth quarter combined return (Form NYS-45), employers report per individual employee the annual total federal gross wages that were subject to state/local income tax withholding for the year and the annual total amount of New York State, New York City and Yonkers tax withheld. As a result of this reporting, employers are not required to submit Forms W-2 to the Department. Effective in 2019, employers will be required to report the state/local income tax withholding details (wages and amount withheld) by individual employee on a quarterly basis as they do with the SUI wage detail. The governor's FY 2019 executive budget document (page 18) reports that the quarterly reporting of withholding tax information will help to reduce fraudulent tax refund claims. All employers are required to file Form NYS-45 electronically over the Department's Withholding Tax Web File system. For more information on the electronic reporting requirement, see the Department's website. The Department is expected to issue information on the new reporting requirement closer to the effective date. (Telephone conversation, New York State Department of Taxation and Finance, withholding tax representative, May 7, 2018.) See Tax Alert 2018-0724, for information on another payroll-related change provided for under the FY 2019 budget — the new optional Employer Compensation Expense Tax (ECET), that aims to protect New York individual taxpayers from increased federal income taxes resulting from the $10,000 cap on state and local tax (SALT) deductions under the?Tax Cuts and Jobs Act?(TCJA).
Document ID: 2018-0967 | |||||||||
