Recently promulgated Oregon Department of Revenue regulations require employers to report the statewide transit tax in Box 14 of Form W-2, with the designation "ORSTT W/H" (for example, ORSTT W/H - $15.00). This change is effective for calendar year 2019 Forms W-2, due to employees and the Department by January 31, 2020. (OAR 150-316-0359(3)(a); Payroll Tax News, email listserv, April 2, 2019.)

The Department removed the requirement to report statewide transit taxable wages after receiving feedback that this information would essentially be the same as Oregon taxable wages, which are already being reported in Box 16 of the W-2. The statewide transit taxable wages field will still exist as an optional field in the Department's manual entry, spreadsheet import, and bulk filing options.

As we previously reported, legislation enacted in 2017 created the new payroll tax on Oregon residents and nonresidents working in Oregon to fund state highway upgrades. (HB 2017.) (EY Payroll Newsflashes Vol. 18, #144, 8-22-2017; Vol. 19, #037, 2-2-2018; #074, 4-25-2018; #105, 6-20-2018; #122, 7-20-2018.)

Effective July 1, 2018 employers and payers are required to withhold the 0.1% tax from the:

• Wages of Oregon residents (regardless of where the work is performed)
• Wages of nonresidents who perform services in Oregon
• Periodic payments made under ORS 316.189, not including retirement income paid to nonresidents from an Oregon source.

Employers do not match the employee withholding tax.

Employers are required to file Forms W-2 electronically through the Department's iWire system. The system will have the statewide transit tax withholding field available. Also, the bulk file specifications have been updated to include and accept this new information.

For more information on the statewide transit tax, see the Department's website.

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EY Payroll News Flash