Purpose:

The purpose of this bulletin is to notify agencies of changes in maintenance rates for employee housing and meals.

Affected Employees:

Employees with deductions for employee housing and/or meals using Deduction Code 401 (Taxable Maintenance) or 402 (Non-Taxable Maintenance) are affected.

Background:

In accordance with Division of the Budget Policy and Reporting Manual Items B-300 and B-300A, issued August 11, 2023, maintenance rates have been increased.

Note: Items B-0300 and B-0300A include information for specific unions/bargaining units.

The Determining Taxability of Maintenance Deductions attachment can be used as a guideline for establishing the taxable status of maintenance deductions for State employees.

Effective Dates:

The changes outlined in Items B-0300 and B-0300A are effective as of September 1, 2023.

OSC Actions:

OSC will create Control-D report NBEN725 (Employees with Maintenance Deductions), available on September 1, 2023, to identify employees who have maintenance deductions in each agency.

Agency Actions:

Agencies are required to become familiar with IRS regulations on employer provided lodging, specifically the conditions for excluding the value of employer provided lodging from employee’s taxable income, and to make appropriate procedural changes to ensure compliance. Please see IRS Publication 15-B (Employer’s Tax Guide to Fringe Benefits) for additional information and guidance.

Agencies must report changes to maintenance deductions by inserting a new effective dated row on the General Deductions page. The effective date should be the first day of the pay period for the check date in which the deduction will be effective.

NOTE: This deduction should be immediately end dated when an employee is no longer receiving employer provided maintenance.

Questions:

The Division of Budget Policy and Reporting Manual, Item B-300 and Item B-300A issued August 11, 2023 are available from the Division of the Budget at: https://www.budget.ny.gov/guide/bprm/b/b-0000.html.

Tax related questions regarding this bulletin may be directed to the Tax and Compliance mailbox.

Deduction related questions regarding this bulletin may be directed to the Payroll Deduction mailbox.