STATE COMPTROLLER
As discussed in the
August webinar, OMES will be gathering information to report early payment
discounts taken by agencies and institutions of higher education. Most agencies are indicating discounts taken
within PeopleSoft, either at the PO level or the voucher level. However, entities that use the "Vouchers from
Remote" process must provide information on discounts taken another way. These entities must submit a spreadsheet or
file showing the voucher number and the amount of the discount taken. Only list vouchers for which discounts were
taken. These entities should start
tracking discounts beginning with January 2018 payments and report discounts
taken for the first quarter of calendar year 2018, no later than April 30,
2018. Spreadsheets may be e-mailed to earlypaydiscount@omes.ok.gov.
PAYROLL
In planning your work for December, it is important to remember
that the state holidays for Christmas this year are Monday and Tuesday Dec. 25
and 26. Additionally, the New Year’s Holiday is on Monday Jan. 1, 2018.
December biweekly payroll for state agencies (“B” or “C” biweekly schedules)
will be paid on Friday Dec. 8 and Friday Dec. 22. December monthly payrolls
will be paid on the last working day of the month, Friday, Dec. 29.
With these dates in mind, agency staff should plan their work
accordingly for the holiday deadlines:
“B” and “C” BIWEEKLY: The biweekly payroll for “B” and “C”
biweekly schedule agencies will be Fri., Dec. 22. Agencies should have
these payrolls processed and paperwork forwarded to OMES by Fri., Dec. 15.
MONTHLY: Monthly payrolls will be set to pay on Fri., Dec. 29.
Agencies should have these payrolls processed and paperwork forwarded to OMES
by Wed., Dec. 20.
SPECIAL NOTE: The Friday Jan. 5, 2018, biweekly payroll should be
processed and paperwork forwarded to OMES by Thursday Dec. 28.
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Listed below is contact information for OMES personnel working on
the IRS reporting project for tax year 2017. The fax number is 405-522-2186.
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Agencies should review all employee corrections for the year to
ensure they have been processed by OMES/CAR as requested. This includes
cancellation of payroll warrants, overpayment refund requests, social security
number changes, and any other requests that affect W-2 reporting. For any
requests identified as not yet processed, please contact Jean Hayes or Lisa
Raihl for a status update.
Agencies need to review all outstanding employee overpayments and
collect required amounts from employees. After collection, please submit OMES
Form 94P as applicable. Agencies will be entitled to receive refunds for all
forms submitted by Friday, Dec. 22, 2017. After this date, refunds cannot be
returned to the agencies; however, agencies are still required to submit the
form after this date for employee wage corrections. Corrections due to
overpayments will be posted to the employee’s 2017 W-2 for requests
submitted through Friday, Jan. 5, 2018. Any corrections submitted after Jan. 5
will require a corrected W-2.
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Any taxable fringe benefits not yet recorded and reported this
year, must be included in December payroll. The payroll system has been
structured to accommodate the reporting of non-cash, taxable fringe benefits.
Of specific concern to state employees, the following benefits should be
reviewed to determine if W-2 wage adjustments are necessary:
- Employee use of state vehicles
- Maintenance, car and housing allowances
- Additional non-cash benefits
Reporting of these benefits is required by state and federal law,
and it is the responsibility of the individual agency to ensure compliance. If
the item is not run through the payroll system in the current year, the
employer can deduct the taxes associated with the wage item on a following
paycheck in the next year as a miscellaneous deduction. The state is
responsible for depositing the taxes. Any taxes associated with items
not run through the payroll system will need to be sent to OMES in a timely
manner so the tax deposits can be made and the items posted to the employee’s
earnings record.
Please refer to the W-2 instructions and Publication 15A, Employer’s
Supplemental Tax Guide, for additional information if needed. Also, refer to
OMES Human Capital Management rules to determine whether these
payments are a valid pay plan for a particular agency.
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The collection of any outstanding overpayments is especially
important at year end and must be conveyed to employees who owe any monies back
to the agency if they want to repay only the net amount. Employee
overpayments that are collected in the next calendar year are to be repaid at
the gross overpayment amount in accordance with Internal Revenue Service
regulations. If an employee owes the agency, please be certain to let the
employee know if the amount is not paid in full by Dec. 31, 2017, the amount they
owe will increase to the gross amount.
In addition, employees who do not reimburse the overpayment in the
current year are subject to taxes on the overpaid amount and later, in the year
the overpayment is reimbursed, the employee may be entitled to take a deduction
or credit on their current year tax form. This may not be advantageous to
the employee, and they should seek advice from their tax accountant.
For example, John Deere was overpaid in September 2017 by
$1,000.00 regular wages. This was discovered in October and the agency
calculated what the correct payroll should have been. The net check difference
is $743.50. If John reimburses the overpayment before the end of the year
(by personal check, miscellaneous deduction, or other reduction), he would pay
$743.50 and his W-2 will correctly reflect his pay reduced by the
reimbursement. If he reimburses the agency after year-end, he must pay
$1,000, and his 2017 W-2 would include the $1,000 overpayment in taxable
wages. In 2018 he may be entitled to take a deduction or credit on his
personal tax return for the reimbursement, which may not be beneficial to
him.
In accordance with 74 O.S. § 840-2.19, the agency must send a
notice to the employee within 10 days of identifying an overpayment. The
employee then has 30 days to respond to this notification. Employees have
several options for repaying overpaid payroll amounts:
- reduction of annual leave
(for the gross overpaid),
- reduction of current gross
salary (for the gross overpaid during the same calendar year) in a lump
sum or installments over a term not to exceed the term in which the
overpayment(s) occurred,
- lump-sum cash repayment,
- miscellaneous payroll
deduction (for the net overpaid during the same calendar year) in a lump
sum or installments over a term not to exceed the term in which the
overpayment(s) occurred,
- any combination of the above
options.
For amounts paid back in subsequent years, the applicable W-2, corrected W-2, or W-2C for the year of the overpayment will only reflect a change
in Social Security and Medicare wages and taxes. Since the employee
received and had use of the funds during the year of overpayment, the amount is
taxable for federal and state purposes. Federal and state taxable wages
or income taxes withheld will not be changed.
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Please verify the correct agency address is being used on the
Oracle/PeopleSoft HCM system. The agency address can be found on the Employee’s
Earnings Statement. If the address is not correct for the agency, it must be updated before year end processing of tax forms. Please contact the
OMES Service Desk at 405-521-2444 to have the agency’s address updated in the
HCM system.
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As a reminder, in the Oracle/PeopleSoft HCM system, the W-2
process loads the employee’s mailing address for IRS Form W-2 reporting.
If there is no value in the mailing address field, then the employee’s home
address will be used on the W-2. If there is a value in the mailing
address field that is not to be used on the Form W-2, it must be updated or inactivated.
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The 1095-C form process in the Oracle/PeopleSoft HCM system has
been set to load the employee’s mailing address just as the W-2 process does.
If there is no value in the mailing address field, then the employee’s home
address will be used on the 1095-C form. If there is a value in the
mailing address field that is not to be used on the 1095-C form, it must be updated or inactivated.
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Oracle/PeopleSoft HCM system employee W-2s and 1095-C forms are
processed and printed in mail drop order. Please ensure this field is
properly used for employees. The forms will print in the same order as checks
and advices sort, which is based on each agency’s needs.
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- State Agency W-2
forms will be printed from the PeopleSoft HCM System. The format for
the W-2 forms will be the same as that used last year. Envelopes that
fit the 2016 PeopleSoft W-2 forms should fit the 2017 W-2 forms.
- The format for the 1099
MISC forms is the same as last year. The forms will have three
sections with the top 1/3 and the middle 1/3 of the page containing the 2
copies of the form. The bottom 1/3 of the page will contain the mailing
addresses. Instructions will print on the back of the form. Standard
No. 9 or No. 10 envelopes with left windows should work.
Sample printed forms of the PeopleSoft W-2 and 1099 MISC can be
provided if requested. Please contact Jean Hayes at 405-522-6300 or jean.hayes@omes.ok.gov, or Beth
Brox at 405-522-1099 or beth.brox@omes.ok.gov.
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OMES will have W-2s, 1099s, and 1095 CDs ready for release on Jan.
16, 2018, beginning at 10 a.m. through Thursday Jan. 18, 2018, at 3 p.m.
Agencies will pick up the forms from our location at 5005 N Lincoln
Blvd., Suite 100. You may park in front of our building in the
visitor parking which faces Lincoln Boulevard. As you enter the building, you will
need to sign in at the Central Purchasing reception area. Once signed in, a
team member will direct you to the room where the forms will be distributed.
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Dec. 22, 2017 – Last day refund of taxes due to overpayments
can be returned to agencies (See above article).
Dec. 27, 2017 – Last day OMES will process payrolls for
calendar year 2017. PeopleSoft payrolls must be delivered to OMES by 3
p.m. on this date. Any payrolls received after this deadline may not
process to pay timely.
Dec. 28, 2017 – Backup withholding payments from agencies
must be received by OMES (See article below).
Jan. 5, 2018 – Payroll warrant cancellations, OMES Form
94Ps, and earning adjustments for calendar year 2017 must be received by OMES
no later than 5 p.m. Any 2017 payroll information received after this date will
require the agency to complete a corrected W-2.
Jan. 5, 2018 – Last day for state agency updates to
employees' ACA Eligibility Page in order for the 1095-C forms to be correct.
Changes to 2017 data after this date must be communicated to Kristin Elsenbeck,
Human Resources Coordinator, kristin.elsenbeck@omes.ok.gov,
405-521-3947, for accurate 2017 reporting.
Jan. 16 – Jan 18, 2018 – All forms are to be picked
up on Jan. 16, 2018 beginning at 10 a.m. through Thursday Jan. 18, 2018 at 3
p.m. (see article above).
Jan. 25, 2018 - Last date to submit corrected W-2 and 1099
forms for file submission (See articles below).
Jan. 31, 2018 – Deadline for delivering forms to employees.
Feb. 15, 2018 – Form W-4 with exemption expires (See article
below).
Feb. 23, 2018– Last date to submit corrected 1095-C forms for
file submission (See article below).
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Agencies that have collected backup withholding on miscellaneous
claims need to submit payment to be received by OMES prior to Dec. 28, 2017.
Please make interagency wires payable to the State Contribution Fund (Vendor
0000000467, ADDR # 002, LOC # 0002). After processing payment, please send
details of the payment to Jean Hayes or Lisa Raihl at jean.hayes@omes.ok.gov or lisa.raihl@omes.ok.gov
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Corrected W-2 forms must be delivered to OMES by Jan. 25, 2018, in
order for the corrections to be in the submission file. The IRS has
accelerated the requirements for reporting certain year-end information. The
due date for submission of form W-2 information to the IRS is Jan. 31, 2018.
Please send the original W-2, a copy of the corrected form and a
memo explaining why the correction is needed. If the correction is due to
a statutory canceled warrant which is not to be replaced, please also send a
letter asking that the warrant not be replaced. Note: Because a
warrant has been canceled by statute is not a reason for such a W-2
correction. If it was a valid payroll payment, the employee is still
entitled to a replacement warrant; therefore, the W-2 reporting is proper.
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IRS Publication 15 Circular E, Employer’s Tax Guide, states that
any federal income tax withholding must be based on marital status and
withholding allowances. Withholding cannot be based solely on a fixed
dollar amount or percentage. In addition to the amount calculated on
marital status and withholding allowances, an employee may specify a dollar
amount to be withheld. The employee must submit a valid Form W-4
stating his or her marital status, number of allowances, and any additional
withholding requested.
Exemption from federal income tax withholding is generally claimed
when an employee had no income tax liability in the prior year and expects none
for the current year. Exempt W-4s are valid for one calendar year and a
new W-4 must be submitted by Feb. 15, 2018, to continue exempt status. If a new
W-4 is not received, withholding is based on single status with zero allowances
or the last valid W-4 the agency has for the employee. To claim exempt status,
the employee completes only boxes 1, 2, 3, 4, and 7 and signs the form. If
an exempt W-4 has a number on line 5 (allowances) or an amount on line 6
(additional amount), you may treat the form as invalid and ask for another one.
If a new W-4 is not received, withholding is based on single with zero
allowances or the last valid W-4 the agency has for the employee.
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An employee who certified to his or her employer on Form W-4
(Employee’s Withholding Allowance Certificate) that the employee had no income
tax liability for 2016 and anticipated no income tax liability for 2017 was
entitled to an exemption from withholding for 2017. This exemption expires
on Feb. 15, 2018, and must be renewed if conditions remain the same. If you
receive an exempt W-4 after Feb. 15, 2018, do not process a tax refund to the
employee or submit a request to OMES. They will not be
processed. If you receive an exempt W-4 after Feb. 15, 2018, the W-4 will
take effect on the next pay cycle; per IRS regulations it is not retroactive to
the beginning of the year.
If you have received correspondence from the IRS specifying the
maximum number of withholding allowances permitted (commonly referred to as a
“lock-in-letter”) and the employee submits a new W-4 claiming more allowances
than the maximum allowed, you must disregard this new W-4 until the IRS
notifies you to withhold tax based on the new W-4. However, the employee
may furnish a new W-4 that claims fewer allowances than the maximum allowed and
the employer must withhold tax based on that Form W-4. See Employee W-4
Lock-in Letters article below.
In addition, the loss of an exemption that affects withholding at
the beginning of the next taxable year, such as a divorce or the loss of a
dependent should be reflected by an amended certificate on or before Dec. 1. If
the change occurs in December, the new certificate must be furnished within 10
days of the day on which the change occurs.
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When an agency receives Letter 2800C, WHC Lock-in Letter to
Employer, from the Internal Revenue Service (IRS), the letter instructs
employers to begin withholding federal income tax at a specific marital status
and withholding allowance for a particular employee. You must
withhold tax as indicated in the lock-in letter by the date specified unless
the IRS notifies you otherwise. This date is generally 60 days after the date
of the lock-in letter. Once a lock-in rate is effective, an employer can’t
decrease withholding unless the IRS approves it. If the employee no longer
works for you, you don’t need to do anything. However, if the employee returns
to work within 12 months, you should begin withholding income tax from the
employee’s wages based on the withholding rate in the letter.
Within the HCM system, enter the lock-in letter information
(marital status and withholding allowances) on the employee’s Federal Tax Data
page. Under the Lock-in Details area, be sure to select the Letter Received
box.
The IRS lock-in letter paperwork will include a copy of the letter
to give to the employee. The letter will explain how the employee can provide
additional information to help the IRS determine the appropriate number of
withholding exemptions. The IRS will give the employee some time before the
lock-in rate is effective to submit a new Form W-4 and a statement that
supports the claims made on it. You must disregard any Form W-4 submitted by
the employee that decreases the amount of withholding. The employee must submit
for IRS approval any new Form W-4 and a statement that supports his or her
request to decrease federal income tax withholding. The employee should send
the Form W-4 and statement to the address on the lock-in letter. The IRS will
notify you if they approve the employee’s request. However, if the employee
submits a Form W-4 that claims fewer withholding allowances than the maximum
number specified in the lock-in letter, you must increase withholding based on
that Form W-4.
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Year 2017 rates are
provided for comparison purposes. View
the Table.
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HIGHER
EDUCATION PAYROLL
In planning your work for December, it is important to remember
that the state holidays for Christmas this year are Monday and Tuesday Dec. 25
and 26. Additionally, the New Year Holiday is Monday Jan. 1, 2018. With
these dates in mind, please adjust your payroll processing schedules as needed.
All payroll documents must be received five (5) business days prior to the
actual pay date to ensure adequate time for audit and processing.
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MISCELLANEOUS
Pursuant to Internal Revenue Code Section 6056 of the Patient
Protection and Affordable Care Act (“PPACA”), as a large employer, we are
required to file an informational return with the IRS related to the offer of
health coverage to employees. Additionally, we must provide employees with a
statement that includes the information we will be providing in our IRS filing.
This “Employee Statement” is the IRS Form 1095-C which includes information
about health insurance coverage offered to state employees, their spouse, and
dependent(s).
For employees that have worked in multiple agencies during the
year, only one 1095-C form will be produced. This combined 1095-C form includes
information related to the employee across the multiple agencies. The agency on
record as the primary agency as of 12/31 received the 1095-C to distribute.
NOTE: Only employees eligible for an offer of health coverage or
those in a stability period with an offer of coverage will receive a 1095-C
form for 2017. Not all employees will receive a 1095-C form.
The 1095-C forms will be provided to agencies on a CD. It
is important that agencies print these documents and provide a copy to your
eligible employees. The IRS mandates that this document be provided to
employees by the end of January of the following year.
In addition to the 1095-C form, state agency employees that
enrolled in health coverage will receive a 1095-B form from their insurance
carrier. The 1095-B form provides information about who was covered and the
periods of coverage.
For questions related to ACA reporting, please contact Kristin
Elsenbeck, human resources coordinator: 405-521-6030; kristin.elsenbeck@omes.ok.gov.
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Corrections for Form 1095-C must be submitted to OMES/HCM Division
by Feb. 23, 2018. Please send the original form, a copy of the corrected
form, and a memo explaining why the correction is needed. Please send
corrections to the attention of: Kristin Elsenbeck, Human Resources
Coordinator, 405-521-6030.
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1099 INFORMATION
2017 – IRS TIN Matching
OMES
will be TIN matching with the IRS all vendors who have received 1099 reportable
payments for tax year 2017. By doing
this we hope to provide more correct information on the original 1099 that the
vendor will receive since the time for reporting is more limited for 2017. We will notify individual agencies of vendors
that don’t match with the IRS, asking for them to provide the necessary
correcting information. Please be ready
to respond promptly if/when you are notified.
Please contact Beth Brox at 405-522-1099 or by e-mail at Beth.Brox@omes.ok.gov if you have any questions.
2017 – 1099 Report
The year end 1099 Report is available for each agency to run in
the PeopleSoft Financials system any time. The path for this report
is: Accounts
Payable, Reports, Payments, Misc Tax Information Report. Make sure the dates include 01/01/2017 –
12/31/2017. This report will reflect
the 1099 data from PeopleSoft vouchers. Be advised that any vendor with a 1099
Flag of “N” on the report will Not receive a 1099 unless they are paid
using a medical or legal account code. If the vendor should be issued a 1099
please let OMES know so we can change the 1099 Flag to “Y.” The final report should
be processed by agencies no later than Jan. 3, 2018, or preferably by Dec. 30,
2017. All corrections must be returned
to Beth Brox at OMES by Jan. 5, 2018.
1099 File Format – Outside Agencies
Any agency needing to submit an additional file for 1099M
reporting should use the format listed in the link below (CAR forms page).
Instructions are provided in a separate link as well as 1099M reportable object
codes. Due to the sensitive nature of the data, please submit your file by a
password protected email to Beth.Brox@omes.ok.gov
or hand-deliver a CD in the file format to OMES, 5005 N. Lincoln
Blvd., Suite 100. It is recommended that
these agencies submit a test file by Dec. 15, 2015, to have a Name and TIN
Match done with the IRS. Final information is due Jan. 5, 2018.
The file instructions and format can be found on the CAR
forms page of the OMES website:
-
1099 Detail File Format –
Outside Agencies
-
1099 Outside Agency
Cross-Reference
-
1099 Instructions – Detail
File Format
2017 – IRS Tax Filing Deadline – Reminder
Tax reporting for 2017 will be at an
accelerated pace due to new IRS regulations.
1099s and W2s will be distributed January 16 – 18, 2018. Any corrections will be required to be
returned by January 25, 2018 so they can be entered in the file which is due to
be filed with the IRS by January 31, 2018.
Any corrections needed after this date should still be sent to OMES for
us to notify the IRS. This will ensure
our reporting is as accurate and complete as possible.
NOTE:
This does not apply to Higher Ed
Institutions since they will be doing their own 1099 reporting for 2017.
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AGENCY NEWS
The 2018 Valid EFT Date
Calendar has been released by the State Treasurer’s Office and can be found by clicking here.
Please use the calendar to ensure that your EFT items process with the effective
dates intended.
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The State Treasurer’s office
would like to announce Sherian Kerlin's retirement and replacement. Charles Hover will replace Sherian as the Director of Portfolio Accounting and
Reporting. Charles' contact information is charles.hover@treasurer.ok.gov or 405-522-9465.
TRAVEL
The Internal Revenue Service has announced an
increase in the mileage reimbursement rate, effective January 1, 2018, to
$0.545 per mile. This is an increase from
the $0.535 rate for 2017. (See Internal
Revenue newswire 2017-205, released 12-14-17)
The new rate is for travel incurred on and after January 1, 2018, not
your 2017 travel reimbursement claims submitted after January 1st.
Please
remember that OMES announced in the November 8, 2017 CAR Newsletter,
Volume 28, No. 5, that the mileage rate of $0.47 as established by OMES will
remain the same for 2018. Executive branch state agencies are required
to continue using this rate. OMES highly recommends that all agencies
and political subdivisions take advantage of the savings offered by using this
rate.
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ACCOUNTING
Click here to view the CY 2018 p-card cycle payment processing schedule.
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