REQUEST LETTER
02-023
NAME
ADDRESS
PHONE
COMPANY is investigating procedures to put into place pay agent reporting of state copies of the federal form W-2. A common pay agent would be one company filing W-2's (using the common pay agents EIN in box "b" of the W-2) for several related companies. Box "c" of the W-2 would show the common pay agents name and address along with a notation "Agent for XYZ Company" on the second line.
The answers to the following questions will be beneficial to COMPANY in meeting year end filing procedures
for 2002.
1. Will your state allow common pay agent reporting form W-2?
2. If yes, then will there by any special reporting requirements for the 2002 W-2 (paper or magnetic media)?
3. If no, can you please provide state issued documentation that would clearly show that this is prohibited?
If you have any questions, you can reach me at the below telephone number. Due to the nature of our business, it is very important to have clear written documentation to substantiate our actions. Please be kind enough to respond to us in writing as quickly as your schedule will allow. With your reply, please include a telephone number that you may be reached at in case I have further or follow up questions. Also, if at all possible, please fax your response to me at #####. I can also be emailed at EMAIL
COMPANY is a developer of in-house Payroll and H/R software applications. Our goal is to maintain an accurate system and meet all required tax compliance.
Sincerely,
NAME
RESPONSE LETTER
January 14, 2003
NAME
ADDRESS
RE: Private Letter Ruling – Common Pay Agent Reporting of W-2 Forms
Dear NAME
We have received your request for information concerning Utah’s individual income tax reporting requirements. You have specifically inquired whether Utah allows a common pay agent to report the W-2 forms for different companies. As we understand it, a “common pay agent” is a payroll company who reports W-2 forms for another company (its “client company”). While a common pay agent can report a client company’s information separately, it sometimes combines several client companies’ information together on a combined report.
Utah law requires that each employer withhold wages, pay amounts required to be withheld, and file returns. Utah Code Ann. §§59-10-402(1); 59-10-406. Accordingly, Utah has historically not allowed a common pay agent to report and submit W-2 forms that combine wage information for more than one company. Utah has interpreted these statutes to require separate filings for each company. Nor has Utah allowed a common pay agent to file reports using the common pay agent’s EIN in box “b” of the W-2 form instead of the client company’s account number.
However, Utah has allowed a common pay agent to report and submit other companies’ W-2 forms when the agent lists the client company’s own account number on the reports and does not combine the client company’s wage information with that of other companies. Along with the W-2 reports, the agent should also submit either a Tax Commission Form TC-96R or, if filing electronically, Form TC-679A (copies enclosed). If using electronic or magnetic media to report and submit the W-2 forms, follow the guidelines in Publication 32MR, Instructions for Annual Reporting of W-2, 1099-R, and TC-675R Information (copy enclosed).
Auditing Division should be able to answer most of your questions pertaining to individual income tax reporting requirements by telephone at PHONE. For any other question, please contact us.
For the Commission,
Marc B. Johnson
Commissioner
ENC.
02-023