Section 11-1771
§ 11-1771 Requirement of withholding tax from wages. (a) General. (1)
Every employer maintaining an office or transacting business within this
city or state and making payment on and after January first, nineteen
hundred seventy-seven of any wages taxable under this chapter, or under
section two of chapter eight hundred eighty-two of the laws of nineteen
hundred seventy-five, as amended by chapter eight hundred eighty-six of
the laws of nineteen hundred seventy-five, shall deduct and withhold
from such wages for each payroll period a tax computed in such manner as
to result, so far as practicable, in withholding from the employee's
wages during each calendar year an amount substantially equivalent to
the tax reasonably estimated to be due under this chapter or such
section two resulting from the inclusion in the employee's city adjusted
gross income of his or her wages received during such calendar year. The
method of determining the amount to be withheld shall be prescribed by
regulations of the tax commission, with due regard to the city
withholding exemptions of the employee and the sum of any credits
allowable against his or her tax. The section shall not apply to
payments by the United States for service in the armed forces of the
United States so long as the right to require deduction and withholding
of tax from such payments is prohibited by the laws of the United
States. Service in the armed forces of the United States shall have the
same meaning as when used in a comparable context in the laws of the
United States relating to withholding of city income taxes.
(2) The tax commission may provide, by regulations, for withholding:
(A) from remuneration for services performed by an employee for his or
her employer which does not constitute wages, and (B) from any other
type of payment, with respect to which the tax commission finds that
withholding would be appropriate under the provisions of this chapter,
if the employer and the employee, or in the case of any other type of
payment the person making and the person receiving the payment, agree to
such withholding. Such agreement shall be made in such form and manner
as the tax commission may by regulations provide. For purposes of this
chapter, remuneration or other payments with respect to which such
agreement is made shall be treated as if they were wages paid by an
employer to an employee to the extent that such remuneration is paid or
other payments are made during the period for which the agreement is in
effect.
(3) The tax commission shall provide by regulation for an exemption
from withholding for: (i) employees under eighteen years of age, (ii)
employees under twenty-five years of age who are full-time students and
(iii) employees over sixty-five years of age, provided such employees
had no income tax liability in the prior year and can reasonably
anticipate none in the current year.
* (b) Extension of withholding to certain periodic payments and
gambling winnings.
(1) For purposes of this chapter, any payment subject to withholding,
within the meaning of paragraph two of this subdivision, shall be
treated as if it were wages paid by an employer to an employee.
(2) Payments subject to withholding. For purposes of paragraph one of
this subdivision, a payment subject to withholding means:
(A) Any supplemental unemployment compensation benefit paid to an
individual to the extent includible in such individual's city adjusted
gross income.
** (B) Any member or employee contributions to a retirement system or
pension fund picked up by the employer pursuant to subdivision f of
section five hundred seventeen or subdivision d of section six hundred
thirteen of the retirement and social security law or section 13-225.1,
13-327.1, 13-125.1, 13-125.2 or 13-521.1 of the administrative code of
the city of New York or subdivision nineteen of section twenty-five
hundred seventy-five of the education law.
** NB Expires per ch. 681/92 § 16
(C) Any payment of an annuity to an individual to the extent
includible in such individual's city adjusted gross income, if at the
time the payment is made a request that such annuity be subject to
withholding under this chapter is in effect.
(D) Any payment of winnings from a wager placed in a lottery conducted
by the division of the lottery, if the proceeds from such wager exceed
five thousand dollars and such proceeds are payable pursuant to a prize
claim made by an individual who was a resident of the city at the time
of the selection of the prize winning lottery ticket.
(F) Any amount deducted or deferred from an employee's salary under a
flexible benefits program established pursuant to section twenty-three
of the general municipal law or section one thousand two hundred ten-a
of the public authorities law.
(G) Any amount by which an employee's salary is reduced pursuant to
the provisions of subdivision b of section 12-126.1 and subdivision b of
section 12-126.2 of the code.
(3) Additional provisions applicable to this subdivision.
(A) Request for annuity withholding. A request that an annuity be
subject to withholding under this chapter shall be made by the payee in
writing to the person making the annuity payments.
Such a request may, notwithstanding any provision of law to the
contrary, be terminated by furnishing to the person making the payments
a written statement of termination. Such a request for withholding or
statement of termination shall take effect in such manner as the
commissioner of taxation and finance shall prescribe.
(B) Withholding on lottery winnings upon change of residence. If a
payee of lottery winnings subject to the provisions of subparagraph (D)
of paragraph two of this subdivision changes status from resident to
nonresident, withholding in accordance with such subparagraph shall
constitute other security acceptable to the commissioner of taxation and
finance within the meaning of paragraph four of subdivision (c) of
section 11-1754, unless such payee elects, in such manner as the
commissioner of taxation and finance shall prescribe, to apply the
provisions of paragraph one of such subdivision (c) to the proceeds, in
which case withholding under this subdivision shall no longer apply to
such proceeds.
(C) Proceeds. For purposes of subparagraphs (D) and (E) of paragraph
two of this subdivision, proceeds from a wager shall be determined by
reducing the amount received by the amount of the wager.
(D) Taxes withheld at maximum rate. The tax withheld on any payment
subject to withholding under subparagraph (D) or (E) of paragraph two of
this subdivision shall be withheld at the highest rate of tax on city
taxable income, without any allowance for deductions or exemptions, in
effect under this chapter for the taxable year in which the payment is
made.
(E) Determination of residence. For purposes of applying the
provisions of subparagraphs (D) and (E) of paragraph two of this
subdivision, any payor of proceeds shall determine the residence of the
payee of such proceeds in accordance with regulations or instructions of
the commissioner of taxation and finance or, in the absence of any such
regulations or instructions, in accordance with the address of the payee
required under the provisions of paragraph six of subsection (q) of
section thirty-four hundred two of the internal revenue code.
* NB Expires per ch. 782/88 § 8
* (b) Extension of withholding to unemployment compensation benefits,
annuity payments, and lottery winnings.
(1) For purposes of this chapter:
(A) any supplemental unemployment compensation benefit paid to an
individual to the extent includible in such individual's city adjusted
gross income,
(B) any payment of an annuity to an individual to the extent
includible in such individual's city adjusted gross income, if at the
time the payment is made a request that such annuity be subject to
withholding under this chapter is in effect, and
(C) any periodic payment (but only where such payment is part of a
series of payments extending over a period greater than one year), of
lottery winnings by the division of the lottery, if at the time the
payment is made a request that such lottery winnings be subject to
withholding under this chapter is in effect, shall be treated as if it
were a payment of wages by an employer to an employee for a payroll
period.
(D) any member or employee contributions to a retirement system or
pension fund picked up or paid by the employer for members of the
Manhattan and Bronx surface transportation authority pension plan and
treated as employer contributions in determining income tax treatment
under section 414(h) of the Internal Revenue Code.
(2) Request for withholding. A request that an annuity be subject to
withholding under this chapter shall be made by the payee in writing to
the person making the annuity payments, and a request that lottery
winnings be subject to withholding under this chapter shall be made by
the payee in writing to the division of the lottery, in the manner
prescribed by the commissioner of taxation and finance. A request that
an annuity be subject to withholding may, notwithstanding any provision
of law to the contrary, be terminated by furnishing to the person making
the payments a written statement of termination. A request that lottery
winnings be subject to withholding under this chapter shall not be
revocable while the payee is a nonresident, and shall constitute other
security acceptable to the tax commission within the meaning of
paragraph four of subdivision (c) of section 11-1754 of this chapter.
Such a request for withholding or statement of termination shall take
effect in such manner as the commissioner of taxation and finance shall
provide by regulation.
* NB Effective per ch. 782/88 § 8
(c) Withholding exemptions. For purposes of this section:
(1) The number of city withholding exemptions which an employee
receiving wages taxable under this chapter may claim shall not exceed
the number of city exemptions allowed pursuant to the provisions of
section 11-1716 and such additional city withholding exemptions as may
be prescribed by regulations or instructions of the commissioner of
taxation and finance, taking into account the applicable standard
deduction and such other factors as he finds appropriate.
(2) The amount of each city withholding exemption shall be the amount
of the city exemption allowed pursuant to the provisions of section
11-1716.
(3) Withholding exemption certificate. An employee shall be required
to file with his employer a withholding exemption certificate in
accordance with regulations or instructions prescribed by the
commissioner of taxation and finance.
Section 11-1772
§11-1772 Information statement for employee. Every employer required
to deduct and withhold tax under this chapter from the wages of an
employee, or who would have been required so to deduct and withhold tax
if the employee had claimed no more than one withholding exemption,
shall furnish to each such employee in respect of the wages paid by such
employer to such employee during the calendar year on or before February
fifteenth of the succeeding year, or, if his or her employment is
terminated before the close of such calendar year, within thirty days
from the date on which the last payment of the wages is made, a written
statement as prescribed by the tax commission showing the amount of
wages paid by the employer to the employee, the amount deducted and
withheld as tax, and such other information as the tax commission shall
prescribe. The written statement required herein may be furnished to
such employee in an electronic format.
Section 11-1773
§ 11-1773 Credit for tax withheld. Wages upon which tax is required to
be withheld shall be taxable under this chapter as if no withholding
were required, but any amount of tax actually deducted and withheld
under this chapter in any calendar year shall be deemed to have been
paid to the tax commission on behalf of the person from whom withheld,
and such person shall be credited with having paid that amount of tax
for the taxable year beginning in such calendar year.
For a taxable year of less than twelve months, the credit shall be
made under regulations of the tax commission.
Section 11-1774
§ 11-1774 Employer's return and payment of withheld taxes. (a)
General. Every employer required to deduct and withhold tax under this
chapter shall file a withholding return and pay over to the tax
commission or to a depository designated by the tax commission, the
taxes so required to be deducted and withheld, as hereafter prescribed.
(1) If, after having made a payroll, an employer has been required to
deduct and withhold, but has not paid over, a cumulative aggregate
amount of seven hundred dollars or more of tax during a calendar
quarter, such employer shall file a return and pay over the tax. If an
employer was required to remit a cumulative aggregate amount of less
than fifteen thousand dollars in withholding tax during the calendar
year which precedes the previous calendar year, the tax shall be paid
over on or before the fifth business day following the date of making
such a payroll. If an employer was required to remit a cumulative
aggregate amount more than or equal to fifteen thousand dollars in
withholding tax during the calendar year which precedes the previous
calendar year, the tax shall be paid over on or before the third
business day following the date of making such a payroll. In the case of
an "educational organization" as defined in paragraph two of subsection
(a) of section nine of the tax law or a "health care provider" as
defined in paragraph four of subsection (a) of section nine of the tax
law, the tax shall be paid over on or before the fifth business day
following the date of making such a payroll.
(2) If, at the close of any calendar quarter, an employer has been
required to deduct and withhold, but has not paid over, a cumulative
aggregate amount of less than seven hundred dollars of tax during such
calendar quarter, such employer shall pay over the tax with the
quarterly combined withholding, wage reporting and unemployment
insurance return required to be filed for such quarter by paragraph four
of this subdivision, on or before the last date prescribed by such
paragraph for filing such return.
(3) If an employer makes more than one payroll per week, then such
employer shall determine the applicability of the rules described in
paragraphs one and two of this subdivision measured by the last payroll
made within the week by such employer; provided, however, that in any
week in which the end of a quarter occurs between the making of payrolls
by an employer, any tax required to be deducted and withheld in a
payroll or payrolls made during such week prior to or on the end of the
quarter shall be paid over. If an employer was required to remit a
cumulative aggregate amount of less than fifteen thousand dollars in
withholding tax during the calendar year preceding the previous calendar
year, the tax shall be paid over on or before the fifth business day
following the date of making the last payroll in such quarter. If an
employer was required to remit a cumulative aggregate amount more than
or equal to fifteen thousand dollars in withholding tax during the
calendar year preceding the previous calendar year, the tax shall be
paid over on or before the third business day following the date of
making the last payroll in such quarter. In the case of an "educational
organization" as defined in paragraph two of subsection (a) of section
nine of the tax law or a "health care provider" as defined in paragraph
four of subsection (a) of section nine of the tax law, the tax shall be
paid over on or before the fifth business day following the date of
making such a payroll. For purposes of this paragraph, the term "week"
shall mean the period Sunday through Saturday.
(4)(A) All employers described in paragraph one of subdivision (a) of
section 11-1771, including those whose wages paid are not sufficient to
require the withholding of tax from the wages of any of their employees,
all employers required to provide the wage reporting information for the
employees described in subdivision one of section one hundred
seventy-one-a of the tax law, and all employers liable for unemployment
insurance contributions or for payments in lieu of such contributions
pursuant to article eighteen of the labor law, shall file a quarterly
combined withholding, wage reporting and unemployment insurance return
with the department of taxation and finance detailing the preceding
calendar quarter's withholding tax transactions, such quarter's wage
reporting information, such quarter's unemployment insurance
contributions, and such other related information as the commissioner of
taxation and finance or the commissioner of labor, as applicable, may
prescribe. In addition, the return covering the last calendar quarter of
each year shall also include withholding reconciliation information for
such calendar year. Such returns shall be filed no later than the last
day of the month following the last day of each calendar quarter;
provided, however, that an employer may provide the wage reporting
information covering the last calendar quarter of each year, and the
withholding reconciliation information for such year no later than
February twenty-eighth of the succeeding year.
(B) An employer shall, at the time prescribed by subparagraph (A) of
this paragraph for filing each quarterly combined withholding, wage
reporting and unemployment insurance return, pay over, in a single
remittance, the unemployment insurance contributions and aggregate
withholding taxes required to be paid over with such return.
Notwithstanding any provision of law to the contrary, an overpayment of
unemployment insurance contributions or of aggregate withholding taxes
made by an employer with the quarterly combined withholding, wage
reporting and unemployment insurance return for a calendar quarter may
be only credited by such employer against such employer's liability for
unemployment insurance contributions or aggregate withholding taxes,
respectively.
(5) The tax commission may, if it believes such action necessary for
the protection of the revenues, require any employer to make such return
and pay to it the tax deducted and withheld at any time, or from time to
time.
(6) "Aggregate amount" as used in paragraphs one, two and three of
this subdivision means the aggregate of the aggregate amounts of New
York state personal income tax, city personal income tax on residents
and city earnings tax on nonresidents authorized pursuant to article
two-E of the general city law required to be deducted and withheld.
(b) Deposit in trust for tax commission. Whenever any employer fails
to collect, truthfully account for, pay over the tax, or make returns of
the tax as required in this section, the tax commission may serve a
notice requiring such employer to collect the taxes which become
collectible after service of such notice, to deposit such taxes in a
bank approved by the tax commission, in a separate account, in trust for
and payable to the tax commission, and to keep the amount of such tax in
such account until payment over to the tax commission. Such notice shall
remain in effect until a notice of cancellation is served by the tax
commission.
Section 11-1775
§ 11-1775 Employer's liability for withheld taxes. Every employer
required to deduct and withhold tax under this chapter is hereby made
liable for such tax. For purposes of assessment and collection, any
amount required to be withheld and paid over to the tax commission, and
any additions to tax, penalties and interest with respect thereto, shall
be considered the tax of the employer. Any amount of tax actually
deducted and withheld under this chapter shall be held to be a special
fund in trust for the tax commission. No employee shall have any right
of action against his or her employer in respect to any moneys deducted
and withheld from his or her wages and paid over to the tax commission
in compliance or in intended compliance with this chapter.
Section 11-1776
§ 11-1776 Employer's failure to withhold. If an employer fails to
deduct and withhold tax as required, and thereafter the tax against
which such tax may be credited is paid, the tax so required to be
deducted and withheld shall not be collected from the employer, but the
employer shall not be relieved from liability for any penalties,
interest, or additions to the tax otherwise applicable in respect of
such failure to deduct and withhold.
Section 11-1777
§ 11-1777 Designation of third parties to perform acts required of
employers. In case a fiduciary, agent, or other person has the control,
receipt, custody, or disposal of, or pays the wages of an employee or
group of employees, employed by one or more employers, the tax
commission, under regulations promulgated by it, is authorized to
designate such fiduciary, agent, or other person to perform such acts as
are required of employers under this chapter and as the tax commission
may specify. Except as may be otherwise prescribed by the tax
commission, all provisions of law (including penalties) applicable in
respect of an employer shall be applicable to a fiduciary, agent, or
other person so designated but, except as so provided, the employer for
whom such fiduciary, agent, or other person acts shall remain subject to
the provisions of law (including penalties) applicable in respect of
employers.
Section 11-1778
§ 11-1778 Liability of third parties paying or providing for wages.
(a) Direct payment by third party. If a lender, surety or other person,
who is not an employer with respect to an employee or group of
employees, pays wages directly to such an employee or group of
employees, employed by one or more employers, or to an agent on behalf
of such employee or employees, such lender, surety or other person shall
be liable for the amount of taxes (together with interest) required to
be deducted and withheld from such wages by the employer.
(b) Funds supplied to employer by third parties. If a lender, surety
or other person supplies funds to or for the account of an employer for
the specific purpose of paying wages of the employees of such employer,
with actual notice or knowledge that such employer does not intend to or
will not be able to make timely payment or deposit of the amounts of tax
required by this chapter to be deducted and withheld by such employer
from such wages, such lender, surety or other person shall be liable for
the amount of the taxes (together with interest) which are not paid over
to the tax commission by such employer with respect to such wages.
However, the liability of such lender, surety or other person shall be
limited to an amount equal to twenty-five percent of the amount so
supplied to or for the account of such employer for such purpose.
(c) Effect of payment. Any amounts paid to the tax commission pursuant
to this section shall be credited against the liability of the employer.
To the extent possible under law, Friends of Devin Balkind for Public Advocate has waived all copyright and related or neighboring rights to New York City Administrative Code. This work is published from: United States.
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