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Date: November 25, 2009

Bulletin Number: 944

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Subject

Retirement Plan Checkbox on Form W-2 Wage and Tax Statement

Purpose

To request that agencies identify all employees for whom the Retirement Plan checkbox in Box 13 on the 2009 Form W-2 should not be checked.

Background

IRS Instructions for Forms W-2 and W-3 require that the retirement checkbox be checked for all employees who are eligible to participate in a retirement system of New York State.

As a general rule, all employees are eligible to participate in a retirement system of New York State.  However, there are certain circumstances when employees are not eligible to participate which requires OSC to leave the Box 13 Retirement Plan box unchecked.

Because PayServ does not capture information required to distinguish employees who are not eligible to participate from those who choose not to participate, OSC needs agencies to identify those employees who are not eligible to participate in a retirement system of New York State.

If an employee is receiving payments from a retirement system of New York State as a result of previous state, city or municipal employment, the employee is not eligible to participate in a New York State retirement system as part of the employee’s current employment.

An example of an individual who is not eligible to participate would be a New York State employee who earned wages in 2009 and also received a public pension from a position from which the individual retired prior to 2009.  The Retirement Plan checkbox on this employee’s Form W-2 should not be checked.

Inaccurate reporting may have monetary tax consequences for affected employees.

Affected Employees

Any employee who has previously retired from public service (State or local), is collecting a pension and was rehired by New York State without suspending their pension.

OSC Actions

OSC will systematically check the Retirement Plan checkbox for all employees.  OSC will uncheck the Retirement Plan checkbox for any employee who is identified by agencies as not eligible to participate.

Agency Actions

Agencies must identify employees who did not participate in a retirement system of New York State due to ineligibility. 

After these employees are identified, agencies must send an email with the DeptID, employee name and last four digits of the EmplID to the Tax and Compliance mailbox.  This email must be received by December 21, 2009.

Questions

Questions regarding this bulletin or any Form W-2 Wage and Tax Statement issue should be directed to the Tax and Compliance mailbox.