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MTA Payroll Tax Changes in Payroll for North America

Guest Author

On December 9, 2011 New York Governor Andrew Cuomo signed a tax reform bill into law that will reduce and eliminate the Metropolitan Commuter Transportation Mobility Tax (MTA Payroll Tax) for certain employers, effective for the quarter beginning on April 1, 2012.  With this new legislation the tax rate paid by an employer will vary by quarter depending upon the employer's total payroll expense for the quarter. 

• The delivered default tax rate of 0.34 % will continue to apply if the quarterly payroll exceeds $437,500.
• If the quarterly payroll exceeds $375,000 but is less than $437,501, the tax rate is 0.23%.
• If the quarterly payroll exceeds $312,500but is less than $375,001, the tax rate is 0.11%.
• If the quarterly payroll does not exceed $312,500, then no tax is owed for the quarter.

Also effective April 1, 2012, certain types of employers, such as school districts, are completely exempt from the tax.  In Tax Update 12-B we will provide you the ability to specify the quarterly MTA Payroll Tax Rate (or exempt status) within the PeopleSoft Payroll for North America product.

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