NYS Comptroller Seal  

Bureau of State Payroll Services

Date: June 23, 2000  

 Bulletin No. 165

Subject Changes in the Salary Refund Process (AC-230's).
Purpose To clarify Payroll Office responsibilities for changes to the AC-230 process and to address the problem of unrecovered deductions and unrecovered direct deposit funds.
Affected Employees  Employees who have salary checks returned with unrecoverable deductions or unrecovered direct deposit funds.
Effective Date Immediately
Background Comptroller must revise the reporting of Salary Refunds to ensure that we properly account for unrecovered deductions and unrecovered direct deposit funds. Deductions for savings bonds, direct deposit funds and involuntary deductions (garnishees, court orders, bankruptcies, and tax levies) will require a change (for tax and accounting purposes). Therefore, any AC-230 which includes one or more of these deductions will require adjustment by the agency Payroll Office in accordance with these procedures.
Agency Actions For returned salary checks, including direct deposits January 5, 2000 and later, the Payroll Office should reduce:

1. Deductions for Savings Bonds and Involuntary deductions to zero;

2. The Refund Amount (block 39) and the total of deductions refunded (block 46) by the sum of the unrecovered deductions and unrecovered Direct Deposits; and

3. The Social Security Tax (code 917) and the Medicare Tax (code 927) to correspond with the reduction of unrecovered salary. A sample AC-230 form displaying these calculations is attached.

Any amount owed to the employee (block 49) should be first used to offset any unrecovered deductions.

If an AC-230 has been submitted and there is a subsequent recovery of "unrecovered" deductions or "unrecovered’ direct deposit funds, the Agency must report these recoveries on a new AC-230. The original AC-230 should be noted in the remarks section of the new AC-230. Also the Agency must notify the employee of any changes to the net salary they will experience as result of any OSC changes.

Since this will have an impact on credits OSC gives to agency payroll charges, please share this bulletin with your Accounting Office.

OSC Actions OSC will provide a Correction/Adjustment notice to report any changes it makes to the AC-230. Samples of the Correction/ Adjustment notice and adjusted AC-230's are attached.
Questions Questions regarding this bulletin may be directed to the Salary Determination mailbox.