State Agencies Bulletin No. 237

New Deduction Code (420) for the New York Dependent Care Employer Contribution
Date Issued
February 27, 2001


To explain the establishment of a new non-taxable benefit. The employer maximum contribution is based on the employee's salary and bargaining unit as determined by union negotiated contracts. The following maximum amounts will be applied:

Up to $35,000 $400
$35,001 - $55,000 $300
Over $55,000 $200

Affected Employees

Employees in Bargaining Units 02, 03, 04, 05, 06, 08, 13, 18, 46, 47, 52, 66, 67, 76, 77, 79 who enrolled for the benefit.

Effective Date

Administration checks dated February 28, 2001 and Institution checks dated March 8, 2001

OSC Automatic Processing

OSC will process a file from Fringe Benefits Management Company to report the amount of the non-taxable benefit. The amount reported on this file will appear on the employee's paycheck and W-2 for tax purposes. If an employee also has a deduction for Dependent Care (code 428), OSC will decrease the goal amount for the Dependent Care by the amount of the employer share contribution submitted on the file.

For example: An employee has elected a yearly contribution of $5,000.00 for Dependent Care. The employee's annual salary is $37,000.00. Based on the chart above, the maximum deduction for code 420 would be $300.00. The goal amount for the Dependent Care deduction (code 428) would be reduced by the $300.00 and the employee's goal amount for Dependent Care will be updated to $4,700.00. The total maximum deduction for dependent care from the employee's paycheck for the calendar year will be $4,700.00.

Agency Action

Notify affected employees


Questions may be directed to Regina Pollack, Program Director of the Dependent Care Advantage Account at (518) 473-8091.