04 November 2019 Rhode Island law changes deposit frequency and electronic filing requirements for income tax withholding Recently enacted legislation (Rhode Island HB 5151A, Public Law 2019, chapter 88, article 5) makes significant amendments to Rhode Island's withholding tax law effective in 2020 including a change in the deposit frequency for income tax withholding and a reduction in the threshold that triggers the requirement to file and pay electronically. (ADV 2019-28, Rhode Island Division of Taxation.) Effective January 1, 2020, employers that currently remit withholding tax on a quarter-monthly and daily basis will be required to instead remit on a weekly basis, with payments due each Monday for the preceding week. If Monday falls on a holiday, the payment will be due the next business day (typically Tuesday).
Form RI-941 to be revised and consolidated to encompass filing by all employers on a quarterly basis To simplify reporting, the Division will separate an employer's payment frequency from its filing frequency, to more closely align with IRS rules. All current forms of RI-941 (daily, monthly, quarterly, quarter-monthly) will be consolidated into a new Form RI-941, Withholding Tax Return, for use by all employers on a quarterly basis, with the return due on the last day of the month following each quarter. The first due date will be April 30, 2020, for first quarter 2020, regardless of when an employer's withholding tax was remitted. Beginning on January 1, 2020, every employer that had an average monthly withholding tax amount of $200 or more for the previous calendar year will be required to file returns and remit withholding payments electronically. If the employer fails to pay the tax by electronic means, the employer may be subject to a penalty of 5% of the withholding payment that was not filed electronically, or $500, whichever is less. The penalty may be waived for reasonable cause that was not due to negligence or willful neglect. If an employer required to file a return by electronic means fails to do so, it may be assessed a penalty of $50, unless there was reasonable cause that was not due to negligence or willful neglect. Employers that are required to file and pay electronically will receive a notice from the Division in November 2019 providing further clarifying details and requirements. All employers will receive a "Withholding Account Summary" notice from the Division in December 2019, letting them know about their required due dates for payment of their taxes withheld and their return filings for the 2020 calendar year.
Document ID: 2019-1956 | ||||||||||||||||||||||||||||||
