ENROLLED
Senate Bill No. 626
(By Senators Helmick and Minard)
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[Passed March 9, 2006; in effect ninety days from passage.]
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AN ACT to amend and reenact §11-21-74 of the Code of West Virginia,
1931, as amended, relating to personal income tax; requiring
employers to submit copy of employee's withholding statement
with an annual reconciliation of income tax withheld; and
requiring employer with two hundred fifty or more employees to
submit withholding statements electronically.
Be it enacted by the Legislature of West Virginia:
That §11-21-74 of the Code of West Virginia, 1931, as amended,
be amended and reenacted to read as follows:
ARTICLE 21. PERSONAL INCOME TAX.
§11-21-74. Filing of employer's withholding return and payment of
withheld taxes; annual reconciliation; e-filing
required for certain tax preparers and employers.
(a) General. -- Every employer required to deduct and
withhold tax under this article shall, for each calendar quarter, on or before the last day of the month following the close of such
calendar quarter, file a withholding return as prescribed by the
Tax Commissioner and pay over to the Tax Commissioner the taxes so
required to be deducted and withheld. Where the average quarterly
amount so deducted and withheld by any employer is less than one
hundred fifty dollars and the aggregate for the calendar year can
reasonably be expected to be less than six hundred dollars, the Tax
Commissioner may by regulation permit an employer to file an annual
return and pay over to the Tax Commissioner the taxes deducted and
withheld on or before the last day of the month following the close
of the calendar year: Provided, That the Tax Commissioner may, by
nonemergency legislative rules promulgated pursuant to article
three, chapter twenty-nine-a of this code, change the minimum
amounts established by this subsection. The Tax Commissioner may,
if he or she believes such action necessary for the protection of
the revenues, require any employer to make the return and pay to
him or her the tax deducted and withheld at any time, or from time
to time.
(b) Monthly returns and payments of withheld tax on and after
the first day of January, two thousand one. -- Notwithstanding the
provisions of subsection (a) of this section, on and after the
first day of January, two thousand one, every employer required to
deduct and withhold tax under this article shall, for each of the
first eleven months of the calendar year, on or before the
twentieth day of the succeeding month and for the last calendar month of the year, on or before the last day of the succeeding
month, file a withholding return as prescribed by the Tax
Commissioner and pay over to the Tax Commissioner the taxes so
required to be deducted and withheld, if such withheld taxes
aggregate two hundred fifty dollars or more for the month, except
any employer with respect to whom the Tax Commissioner may have by
regulation provided otherwise in accordance with the provisions of
subsection (a) of this section.
(c) Annual returns and payments of withheld tax of certain
domestic and household employees. -- Employers of domestic and
household employees whose withholdings of federal income tax are
annually paid and reported by the employer pursuant to the filing
of Schedule H of federal form 1040, 1040A, 1040NR, 1040NR-EZ,
1040SS or 1041 may, on or before the thirty-first day of January
next succeeding the end of the calendar year for which withholdings
are deducted and withheld, file an annual withholding return with
the Tax Commissioner and annually remit to the Tax Commissioner
West Virginia personal income taxes deducted and withheld for the
employees. The Tax Commissioner may promulgate legislative or
other rules pursuant to article three, chapter twenty-nine-a of
this code for implementation of this subsection.
(d) Deposit in trust for Tax Commissioner. -- Whenever any
employer fails to collect, truthfully account for, or pay over the
tax, or to make returns of the tax as required in this section, the
Tax Commissioner may serve a notice requiring the employer to collect the taxes which become collectible after service of the
notice, to deposit the taxes in a bank approved by the Tax
Commissioner, in a separate account, in trust for and payable to
the Tax Commissioner, and to keep the amount of the tax in the
separate account until payment over to the Tax Commissioner. The
notice shall remain in effect until a notice of cancellation is
served by the Tax Commissioner.
(e) Accelerated payment. -- (1) Notwithstanding the provisions
of subsections (a) and (b) of this section, for calendar years
beginning after the thirty-first day of December, one thousand nine
hundred ninety, every employer required to deduct and withhold tax
whose average payment per calendar month for the preceding calendar
year under subsection (b) of this section exceeded one hundred
thousand dollars shall remit the tax attributable to the first
fifteen days of June each year on or before the twenty-third day of
June.
(2) For purposes of complying with subdivision (1) of this
subsection, the employer shall remit an amount equal to the
withholding tax due under this article on employee compensation
subject to withholding tax payable or paid to employees for the
first fifteen days of June or, at the employer's election, the
employer may remit an amount equal to fifty percent of the
employer's liability for withholding tax under this article on
compensation payable or paid to employees for the preceding month
of May.
(3) For an employer which has not been in business for a full calendar year, the total amount the employer was required to deduct
and withhold under subsection (b) of this section for the prior
calendar year shall be divided by the number of months, including
fractions of a month, that it was in business during the prior
calendar year, and if that amount exceeds one hundred thousand
dollars, the employer shall remit the tax attributable to the first
fifteen days of June each year on or before the twenty-third day of
June, as provided in subdivision (2) of this subsection.
(4) When an employer required to make an advanced payment of
withholding tax under subdivision (1) of this subsection makes out
its return for the month of June, which is due on the twentieth day
of July, that employer may claim as a credit against its liability
under this article for tax on employee compensation paid or payable
for employee services rendered during the month of June the amount
of the advanced payment of tax made under subdivision (1) of this
subsection.
(f) The amendments to this section enacted in the year two
thousand six are effective for tax years beginning on or after the
first day of January, two thousand six.
(g) An annual reconciliation of West Virginia personal income
tax withheld shall be submitted by the employer on or before the
twenty-eighth day of February following the close of the calendar
year, together with Tax Division copies of all withholding tax
statements for that preceding calendar year. The reconciliation
shall be accompanied by a list of the amounts of income withheld
for each employee in such form as the Tax Commissioner prescribes and shall be filed separately from the employer's monthly or
quarterly return.
(h) Any employer required to file a withholding return for two
hundred fifty or more employees shall file its return using
electronic filing as defined in section fifty-four of this article.
An employer that is required to file electronically but does not do
so is subject to a penalty in the amount of twenty-five dollars per
employee for whom the return was not filed electronically, unless
the employer shows that the failure is due to reasonable cause and
not due to willful neglect.