HOUSE BILL NO. 167
INTRODUCED BY R. JOHNSON
AN ACT REVISING STATUTES IMPACTED BY THE BUDGET DIRECTOR'S CERTIFICATION OF THE TERMINATION OF THE OLD FUND LIABILITY TAX EFFECTIVE JANUARY 1, 1999; REDUCING THE TOTAL EXPENDITURES ALLOWED TO THE STATE FUND FOR ADMINISTERING OLD FUND CLAIMS FROM $3 MILLION TO $1.25 MILLION; AUTHORIZING THE TRANSFER OF FUNDS BETWEEN ACCOUNTS FOR PAYMENT OF CLAIMS; AMENDING SECTIONS 15-30-204, 15-30-207, 15-30-210, 15-30-248, 15-30-304, 39-71-2321, AND 39-71-2352, MCA; REPEALING SECTIONS 39-71-2505 AND 39-71-2507, MCA; AND PROVIDING AN IMMEDIATE EFFECTIVE DATE.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MONTANA:
Section 1. Section 15-30-204, MCA, is amended to read:
"15-30-204. Reporting and remittance requirements. (1) For the purposes of this section, employers shall remit their taxes in accordance with the appropriate remittance schedule as follows:
(a) Employers whose total liability for state income tax withholding during the preceding lookback period was $12,000 or more shall remit on an "accelerated schedule", which is the same as the employer's federal due dates for federal tax deposits.
(b) Employers whose total liability for state income tax withholding during the preceding lookback period was less than $12,000 but more than $1,199 shall remit on a "monthly schedule" for which the remittance due date is on or before the 15th day of the month following the payment of wages.
(c) Employers whose total liability for state income tax withholding during the preceding lookback period was less than $1,200 shall remit on a "quarterly schedule" for which the remittance due date is on or before the last day of the month following the close of each calendar quarter.
(d) Employers who are not subject under Title 39, chapter 51, for unemployment insurance and whose total liability for
state income tax withholding, or if state income tax withholding is not required, whose total liability for old fund liability
tax during the preceding lookback period was less than $1,200, may remit on an "annual schedule" for which the remittance
is due on or before February 28 of the year following payment of wages.
(2) (a) Every employer is required to file a report quarterly in the form required by the department.
(b) The report is due on or before the last day of the month following the close of the calendar quarter.
(c) An employer who is not subject under Title 39, chapter 51, to unemployment insurance may elect to file an annual report on or before February 28 for the preceding calendar year.
(d) An employer who has no payroll during a quarter may elect to report "no wages paid this quarter" using alternative reporting methods provided in department rules.
(e) An employer, in addition to the scheduled reports and remittances, must file the annual report and wage statements as required by 15-30-207.
(3) (a) Except as provided in subsection (3)(g), payments are due as required according to the remittance schedule for each employer.
(b) If an employer subject to the provisions of subsection (1)(d) does not comply with the requirements of this section, the employer may be subject to the quarterly reporting schedule provided in subsection (2)(a) and to the quarterly remittance schedule provided in subsection (1)(c) until the department determines from the employer's subsequent filing and payment history that the employer will file and remit in a timely fashion.
(c) On or before November 1 of each year, the department shall notify the employers subject to the provisions of this section of the employers' remittance schedules for the following calendar year based upon the department's review of the preceding lookback period.
(d) Except as provided in subsection (3)(g), a new employer or an employer with no filing history is subject to the quarterly remittance schedule in subsection (1)(c) until the department is able to determine the employer's proper remittance schedule by a review of the employer's first complete lookback period.
(e) An employer who is subject to the quarterly schedule in subsection (1)(c) may elect to remit payments on a more frequent basis. An employer who is on an annual schedule may elect to remit monthly or quarterly payments.
(f) An employer who exceeds either threshold, as defined in 15-30-201(4)(b) and (4)(c), must begin withholding state income tax on or before the last day of the month following the quarter in which the wages paid exceeded the threshold requirements. The employer is subject to the quarterly remittance schedule until the department is able to determine the employer's proper remittance schedule by a review of the employer's first complete lookback period.
(g) An employer who is not subject to unemployment insurance under Title 39, chapter 51, and whose estimated annual
state income tax withholding, or if state income tax withholding is not required, whose estimated old fund liability tax, is
not expected to exceed $1,199 for the calendar year may remit according to the annual schedule and report annually on or
before February 28.
(h) An employer may use alternative remittance methods in conjunction with the department's electronic remittance program in accordance with department rules.
(4) If the department has reason to believe that collection of the amount of any tax withheld is in jeopardy, it may proceed as provided for under 15-1-703.
(5) Each employer shall keep true and accurate payroll records containing the information that the department may prescribe by rule. Those records must be open to inspection and audit and may be copied by the department or its authorized representative at any reasonable time and as often as may be necessary. An employer who maintains its records outside Montana shall furnish copies of those records to the department at the employer's expense."
Section 2. Section 15-30-207, MCA, is amended to read:
"15-30-207. Annual statement by employer. (1) Every employer shall, on or before February 28 in each year, file with
the department a wage and tax statement for each employee in the form and summarizing information as the department
requires, including the total wages paid to the employee during the preceding calendar year or any part of the calendar year
and showing the total amount of the federal income tax deducted and withheld from the wages and the total amount of the
tax deducted and withheld from the wages under the provisions of 15-30-201 through 15-30-209 and 39-71-2503.
(2) The annual statement filed by an employer with respect to the wage payments reported constitutes full compliance with the requirements of 15-30-301 relating to the duties of information agents, and additional information return is not required with respect to the wage payments."
Section 3. Section 15-30-210, MCA, is amended to read:
"15-30-210. Electronic funds transfer and electronic reporting -- employer option. (1) An employer, within 30
days of notification of the employer's remittance schedule as required by 15-30-204, may elect to remit and file state income
tax withholding and old fund liability tax electronically. An election form must be provided with the notification of the
employer's remittance schedule and, when returned to the department, is valid for the next 12 months. An employer may
cancel the election provided in this section by providing written notice of the cancellation to the department.
(2) An employer who elects pursuant to subsection (1) to remit tax payments through electronic funds transfer shall electronically submit the returns required by 15-30-204 to the department in a format established and approved by the department."
Section 4. Section 15-30-248, MCA, is amended to read:
"15-30-248. Determination of employer status. A final determination by either the department of labor and industry or
the board of labor appeals that an employer-employee relationship existed between the taxpayer and certain individuals
subjecting the taxpayer to the requirements of chapter 30, part 2, which may be subject to judicial review, as provided in
39-51-2404, at the discretion of the taxpayer, is not subject to any further administrative or judicial challenge in any
proceeding before or with the department of revenue concerning a determination of the proper amount of state income tax
withholding and old fund liability tax to be paid."
Section 5. Section 15-30-304, MCA, is amended to read:
"15-30-304. Furnishing copy of federal return -- copy of share of income, credit, and deductions schedule --
copies of federal corrections -- filing amended return required. Each taxpayer shall, upon request of the department,
furnish a copy of the return for the corresponding year that the taxpayer has filed or may file with the federal government,
showing the taxpayer's net income and how obtained and the several sources from which derived. Partners of a partnership,
shareholders of a subchapter S. corporation, and members or managers of a limited liability company who are subject to the
workers' compensation old fund liability tax shall attach to their Montana individual income tax return a copy of the share
of income, credit, and deductions schedule that the partner, shareholder, or member or manager received from the entity that
reports income to the federal government for the corresponding year. If the amount of a taxpayer's taxable income is
changed or corrected by the United States internal revenue service or other competent authority, the taxpayer shall report the
change or correction to the department within 90 days after receiving notice of the change or correction. If a taxpayer files
an amended federal income tax return changing or correcting the taxpayer's federal taxable income for any tax year, the
taxpayer shall also file an amended return with the department within 90 days after filing an amended federal income tax
return. The department shall supply all necessary forms and shall, upon the request of the taxpayer, return all forms to the
taxpayer after they have been examined by the department."
Section 6. Section 39-71-2321, MCA, is amended to read:
"39-71-2321. What to be deposited in state fund. (1) All premiums, penalties, recoveries by subrogation, interest
earned upon money belonging to the state fund, and securities acquired by or through use of money, taxes collected under
39-71-2503 and 39-71-2505, and the all interest and penalties on the taxes in accordance with 15-1-501 must be deposited
in the state fund. They Except for a transfer authorized under 39-71-2352, the money must be separated into two accounts
based upon whether they relate to claims for injuries resulting from accidents that occurred before July 1, 1990, or claims
for injuries resulting from accidents that occur on or after that date.
(2) All funds deposited in the state fund are statutorily appropriated as provided in 17-7-502."
Section 7. Section 39-71-2352, MCA, is amended to read:
"39-71-2352. Separate payment structure and sources for claims for injuries resulting from accidents that occurred before July 1, 1990, and on or after July 1, 1990 -- spending limit -- authorizing transfer of money between accounts for payment of claims. (1) Premiums paid to the state fund based upon wages payable before July 1, 1990, may be used only to administer and pay claims for injuries resulting from accidents that occurred before July 1, 1990. Premiums paid to the state fund based upon wages payable on or after July 1, 1990, may be used only to administer and pay claims for injuries resulting from accidents that occur on or after July 1, 1990.
(2) The state fund shall:
(a) determine the cost of administering and paying claims for injuries resulting from accidents that occurred before July 1, 1990, and separately determine the cost of administering and paying claims for injuries resulting from accidents that occur on or after July 1, 1990;
(b) keep adequate and separate accounts of the costs determined under subsection (2)(a); and
(c) fund administrative expenses and benefit payments for claims for injuries resulting from accidents that occurred before July 1, 1990, and claims for injuries resulting from accidents that occur on or after July 1, 1990, separately from the sources provided by law.
(3) The state fund may not spend more than $3 $1.25 million a year to administer claims for injuries resulting from
accidents that occurred before July 1, 1990.
(4) As used in this section, "adequately funded" means the present value of:
(a) the total cost of future benefits remaining to be paid;
(b) the cost of administering the claims; and
(c) an additional amount equal to 10% of the total of the amounts in subsections (4)(a) and (4)(b).
(5) By October 1 of each year following the first full fiscal year after termination of the old fund liability tax, any funds in excess of the adequate funding amount established in subsection (4) must be returned to the account established in 39-71-2321 to pay claims for injuries resulting from accidents that occurred on or after July 1, 1990. The total amount of funds returned to the account under this section may not exceed $63.8 million.
(6) If in any fiscal year after the old fund liability tax is terminated claims for injuries resulting from accidents that occurred before July 1, 1990, are not adequately funded, any amount returned to the account in 39-71-2321 to pay claims for injuries resulting from accidents that occurred on or after July 1, 1990, must be transferred back to the account established in 39-71-2321 to pay claims for injuries resulting from accidents that occurred before July 1, 1990.
(7) The independent actuary engaged by the state fund pursuant to 39-71-2330 shall project the unpaid claims liability for claims for injuries resulting from accidents that occurred before July 1, 1990, each fiscal year until all claims are paid."
Section 8. Repealer. Sections 39-71-2505 and 39-71-2507, MCA, are repealed.
Section 9. Effective date. [This act] is effective on passage and approval.
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Latest Version of HB 167 (HB0167.ENR)
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