Commencing in FY2007 the method of assessing unemployment insurance, universal health insurance and the employer's share of the Medicare tax will be through the fringe benefit rate. The rate used to determine the employer's share of these benefits is estimated at 1.34% (check for updates). The rate is applied to the salaries expended under AA and CC object codes. There is no change in the method used to calculate the employee's share of Medicare tax withholding.
All fringe benefit assessments determined by these rates will be charged to object code D09.
NOTE: FY07 will be the final year in which departments can redirect Payroll Tax Charges. This was done using a CTR managed Crosswalk Table. Beginning in FY08, Tax Chargebacks will be assessed to the account incurring the salary.
Questions regarding these component rates or the MMARS posting of fringe benefits should be directed to the MMARS Help Desk at 617-973-2468.
Departments are responsible for determining and/or verifying the Medicare tax status of each of their employees, and entering that status correctly in HR/CMS. This requires confirming whether an employee has a concurrent job and ensuring that both jobs have the same/correct Medicare status in HR/CMS. Because HR/CMS security does not allow for cross department view, errors sometimes occur.
In order to assist departments in ensuring compliance, the Office of the Comptroller created a new online report named HMTAX010 - Medicare Report that will allow departments to view any inconsistent Medicare tax status for any concurrent job from any department. The report is available in View Direct and Document Direct and is updated monthly. You need to request access to this report from your department's security officer.
See Instructions on HMTAX010
Reporting Excessive Exemptions
For Employees that are claiming exempt status, the IRS requires employees to refile a new form W4 every year (deadline is Feb 15). If claiming exempt from both FED and MA, the IRS form W4 will suffice. It will not need to be filed to the IRS or DOR. MA DOR requires certificate "M4" to be filed with DOR when claiming exempt from MA taxes only.
Report HTAX103 titled RESET W-4 EXEMPT EMPLOYEES - REPORT/UPDATE REPORT has been created to identify employees in your dept that do not have an new Exemption entry for the current tax year. This report is currently accessible through Document Direct.
All forms should be kept on file at the Dept.
- The IRS W4 Form has 2 conditions from which an employee can claim "exempt" from federal Withholdings (W-4 2005), both conditions must be met:
- Last Year I had a right to a refund of all federal income tax withheld because I have no tax liability" and
- This Year I expect a refund of all federal income tax withheld because I expect to have no tax liability"
- Mass DOR Circular M (2005) states any employee with an annual salary less than $8,000.00 should not have taxes withheld
To set-up as "Exempt" in HRCMS, use the "Maintain Taxable Gross" Radial Button and enter $0 for Additional Witholdings. See HRCMS Job Aid - Maintain Employee Tax Data
Massachusetts Department of Revenue allows employees to receive the first $2000 in combined Retirement Deductions and Medicare Tax to be excluded from MA Taxable Gross Wages. So from the start of the new calendar year (Jan) up until this $2000 threshold is met employees will have less MA Taxable Gross to deduct taxes from, thus less MA taxes taken. Employees will see a gradual increase in their MA tax withholding (sometimes up to 2 pay periods) as they approach the $2000 threshold.
Social Security Numbers/VISA Information
SSA does not issue Social Security Numbers that begin with the number 9. For those aliens not eligible for an SSN, Individual Taxpayer Identification Numbers (ITIN) is assigned by the Internal Revenue Service (IRS), NOT SSA. The IRS assigns ITIN's to certain nonresident and resident aliens, their spouses and dependents who need to report income for tax purposes but do not have, and cannot get, a valid SSN. It is a 9-digit number, beginning with the number ""9"" and formatted like an SSN (NNN-NN-NNNN). It may be used for tax purposes only. It cannot be used to work.
For more information or to apply for an ITIN, please see Form W7 on the IRS web site.
The following pertains to working in the U.S:
The Department of Homeland Security's (DHS) U.S. Citizenship and Immigration Services (CIS) is the authority on all matters relating to immigration and naturalization.
You can call the DHS toll-free at 1-800-375-5283 (TTY 1-800-767-1833) for automated information and live assistance concerning immigration services and benefits within the U.S., Puerto Rico, Guam, and the U.S. Virgin Islands. If you are outside these areas, please contact the closest U.S. Embassy or Consulate.
See forms section for Tax Refund forms.
Unemployment Insurance and Universal Health Insurance are employer related taxes created as an umbrella for those without health care coverage or are jobless.
The Commonwealth (the Employer) pays these taxes, not the employee. Not all Commonwealth positions are eligible. The following job categories are exempt from UI & UHI taxes:
- Any elected official.
- Board members.
- Military/National Guard.
- Work study students.
- Inmates working at an institution in which they reside.
- Patients/Clients working at the institution in which they reside.
Because the exempt status is maintained at the employee level, an employee with multiple jobs will be exempt for all jobs.
Example: A judge teaches one semester at a college. DET has determined that this is acceptable given the total annual dollars paid by MA.
Departments are required to maintain the exempt from UI / UHI tax fields in HRCMS. see job aid: HRCMS Job Aid - Maintain Employee Tax Data
See MGL 151A Section 6 and 6 A for more details http://www.mass.gov/legis/laws/mgl
For more information on Massachusetts Unemployment Insurance go to the Department of Unemployment Assistance website.
W-2 General Information
- The IRS requires W2s to be in the mail by Jan 31. Generally, CTR and ITD begin W2 mailings the week where Martin Luther King Day begins (subject to change)
- Employees with multiple jobs spanning multiple departments will receive a single W2 IF all earnings were paid against a single Employee ID. W2s are based on Employee ID not Employee Record #. Departments should notify CTR Payroll immediately if an Employee was paid using 2 separate ID #'s.
W-2c and W-3c forms are for changing W-2 amounts, name, SSN or address information on W-2 forms.
- CTR will create W-2C forms and provide to employees.
- Departments are to file a "Request for a W-2C".
- W-2C data will be entered in HR/CMS under Year-End Forms.
- Request for W-2C Form
W-2 Reprint for HR/CMS V.9
W-2 Reprint for CAPS/PMIS
W-2 Reprint for HRCMS
Employees can also request copies of prior year tax returns or transcripts. See IRS Forms and 4506T for more details (some fees may apply). See the Forms section here: www.irs.gov.