Contact Information • Tax Services Website: http://www.financialreporting.mnscu.edu/Tax_Services/index.html • Ann Page, 651-632-5007 Ann.Page@so.mnscu.edu • Steve Gednalske, 651-632-5016, Steve.Gednalske@so.mnscu.edu
Employment Forms • Form I-9, Employment Eligibility Verification • Form W-4, Employee’s Withholding Allowance Certificate
Tax Form Management • General form information • Form maintenance & documentation • Form storage suggestions • Record retention requirements
Form I-9 Employment Eligibility Verification Form
Form I-9, Employment Eligibility Verification • Department of Homeland Security • USCIS: United States Citizenship & Immigration Services • Law: The Immigration & Control Act • U.S. Employers & Employees • Last updated: 1991
Form I-9, Employment Eligibility Verification • Employee’s responsibility • Complete Section I; Prior to the close of business on the first day of employment services • Employer’s responsibility • Review employment authorization documentation prior to the close of business on 3rd day of employment services
I-9: Section 1
Section 2: Form I-9, Employment Eligibility Verification • Review Documentation • Authorization to work in U.S. • Establish identity • Must match • Record Document Information • Recommended: Copy Documents
I-9: Section 2: Verification F-1/J-1 Students = 3 Documents
List of acceptable documents List A: Employment Eligibility & ID Timely verification Must be verified within 3 days of start date Reasonableness If appears genuine, accept document F-1 Documentation SEVIS Form I-20, I-94, Arrival/Departure Passport Personal Info Include visa stamp I-9 Documentation
Documents that Establish Both Identity & Employment Eligibility And Form I-766, Employment Authorization Document
LIST C: Establishing Employability The combination of documents from List B and List C verifies the I-9
I-9: Section 3, Verification Re-Verification When work authorization documents reach expiration date
I-9 Record Retention I-9’s must be on hand for: • All current employees • Three years after employee’s hire date or 1 year after employee’s termination date whichever is later
I-9 Record Recommendations • In case of audit, I-9’s must be retrievable in 3 days • Recommend keeping I-9’s in a separate file • DISCUSSION • File Maintenance: Campuses
W-4 New from the IRS • Withholding agents are no longer required to send copies of W-4’s to IRS, unless specifically requested
W-4 General Rules • What to do if no W-4? • S-0 • If you have an earlier Form W-4 for this employee that is valid, withhold as you did before. • Validity: Any unauthorized change or addition to Form W-4 makes it invalid. • This includes taking out any language by which the employee certifies that the form is correct. • A Form W-4 is also invalid if, by the date an employee gives it to you, he or she indicates in any way that it is false. • When you get an invalid Form W-4, do not use it to figure federal withholding. Tell the employee that it is invalid and ask for another one.
Claiming Exemption • IRS Code section 3402(n): An employee may claim exemption from income tax withholding if he or she: • Had no income tax liability last year and • Expects to have no tax liability this year. • Exemption is good for one year only • W-4 must be submitted by February 15th • If the employee does not provide a new Form W-4, the employer must withhold tax as if the employee were single with zero withholding allowances.
Figuring Withholding Allowances: Employee Advice • IRS Withholding Calculator http://www.irs.gov/individuals/article/0,,id=96196,00.html • Most recent pay stubs, most recent tax return • The results of this program helps employee to complete a new Form W-4
Figuring Withholding Allowances: Employee Advice • IRS Publication 919: How Do I Adjust My Tax Withholding? http://www.irs.gov/pub/irs-pdf/p919.pdf • Detailed instructions and worksheets for computing tax withholding
W-4 Statutory Withholding When completing Form W-4, nonresident aliens are required to: • Not claim exemption from income tax withholding, • Request withholding as if they are single, regardless of their actual marital status, • Claim only one allowance, and • Request an additional $15.30 in income tax withholding per bi weekly pay period
Students from India & Statutory Withholding • Article 21(2) of the United States-India Income Tax Treaty • Does not have to request the additional withholding amount on line 6 of Form W-4. • An additional withholding allowance may be claimed for a spouse if the spouse has no U.S. source gross income and may not be claimed as a dependent by another taxpayer. • An additional withholding allowance for each dependent (usually a child) who has become a resident alien.
Other Exceptions to Statutory Withholding • Canada and Mexico, American Samoa and Northern Mariana Islands • “Single” marital status; one withholding allowance plus additional withholding allowances for nonworking spouse and dependents; and additional tax of $15.30. • Japan and Korea • “Single” marital status; one withholding allowance plus additional withholding allowances for nonworking spouse and dependents who are present in the US; and additional tax of $15.30.
W-4 Record Retention • Form W-4 remains in effect until the employee gives you a new one. • If an employee gives you a Form W-4 that replaces an existing Form W-4, begin withholding no later than the start of the first payroll period ending on or after the 30th day from the date when you received the replacement Form W-4.
W-4 Record Retention • A Form W-4 claiming exemption from withholding is valid for only one calendar year • Request new W-4 each year from: • Employees claiming exemption • NRA’s with 8233’s • W-4’s must be kept on file for 7 years after the last applicable tax year
W-4 Record Retention: Example • Ann is hired in 2001 & fills out a 2001 W-4 • In 2004, Ann fills out a new W-4 • The 2001 W-4 was used to figure Ann’s withholding for 2001, 2002, 2003 and part of 2004. • The 2001 W-4 must be kept until 2011
I-9 Keep I-9’s for 3 years after hire date or 1 year after termination, which ever is later. Reverify I-9 when employment authorization expires W-4 Current and terminated employees: Keep all W-4’s for 7 years past applicable year If missing or invalid W-4: Withhold S-0 Summary: I-9 & W4 Current Employees: Keep most recent I-9 & W-4 form on file AND:
Retention: Payroll Forms • 7 Years past applicable tax year • Timesheets • W-4 Forms • TRIF • 8233 Forms • Contracts
Student Payroll Tax Residency Information Form • “New” Version • Documentation Requirements • ISRS Tax Residency Year field • Questions
Tax Residency Information Form • Employee’s who indicate on their I-9 that they are “other alien authorized to work until xx/xx/xxxx” must fill out Tax Residency Information Form. • Section E applies SPT
Tax Residency Information Form 2001 F-1 Aug 01 – May 02 High school exchange student program 2002 F-1 Above Ideal Reality: Estimate or Range of Dates
Discussion Nonresident TRIF • Questions • Comments • Concerns
F-1 Students I-20 & Attachments I-94 Passport J-1 Students DS-2016 & Employment Letters I-94 Passport TRIF Documentation
I-20 Certificate of Eligibility for Nonimmigrant (F-1) Student
DS-2019 Certificate of Eligibility for Exchange Visitor(J-1) Status
Passport Information • Identification Page • Current visa information • Prior visits to US
Tax Residency Form Summary • All student employees who indicate on their I-9 that they are “other aliens authorized to work until xx/xx/xxxx”, must fill out the Tax Residency Form • Students must complete Sections A and D. If they have been in the U.S. prior to their current visit, they must also complete Section C. • Student Payroll copies the student’s immigration documents & completes Sections E, F and G. • Student Payroll enters the Tax Residency Year from Section E into ISRS Student Employee Setup (PR0021UG) Screen • Keep the original form with the employee’s records • Send a copy of the completed form and related immigration documentation to Tax Services
Joke Break A student on his deathbed called his friend and said, "Bob, I want you to promise me that when I die you will have my remains cremated." Bob agreed to take care of his friend's request and asked "What do you want me to do with your ashes?" The student said, "Just put them in an envelope and mail them to the Internal Revenue Service and write on the envelope: "Now you have everything."
Student FICA Rule Changes – eff. 4/1/2005 • Full time employees not exempt • Employees who regularly work 40 hours a week = full time, career employees • >30 Hour a week = full time • Tracking • Supervisor Hire Form • ISRS & Tax Service Reports
ISRS Data Entry & Tax Filing • Name Entry • Legal name, Should be the same as on Social Security Card; • New names (ex: married) may not be used until employee has changed their Social Security records with the Social Security Administration (SSA). • Social Security Numbers (SSN) • Look at Social Security Cardor call SSA