CHAPTER 94

An Act providing for the simplification of wage taxes and withholding for household workers, supplementing chapter 9 of Title 54A of the New Jersey Statutes and chapter 21 of Title 43 of the Revised Statutes.

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

C.54A:9-17.2 Filing of tax returns for domestic service workers.

1. a. Notwithstanding the provisions of subsection (a) of N.J.S.54A:7-4 to the contrary, except for an employer also liable for withholding taxes with respect to remuneration for services rendered other than for domestic service, tax returns filed with respect to domestic service shall be filed on a calendar year basis. Such a return shall be filed on or before January 31 following the close of the calendar year and the amount of tax withheld shall be paid over to the Director of the Division of Revenue at that time, together with those contributions treated as taxes pursuant to the provisions of section 2 of P.L.1999, c.94 (C.43:21-11.3).

b. The director shall prescribe such regulations as the director deems necessary to carry out the purpose of allowing employers to convert from a quarterly system of payments and filing to annual filing, and to simplify employer filing by allowing the combination of unemployment compensation, disability benefits and gross income tax remittance for reporting and payment purposes for employees providing domestic services by treating the taxes payable pursuant to subsection a. of this section and those contributions treated as taxes pursuant to the provisions of section 2 of P.L.1999, c.94 (C.43:21-11.3) as taxes subject to the remittance requirements of N.J.S.54A:7-1 et seq. These regulations shall include:

(1) Provisions for the forwarding of contributions treated as taxes pursuant to the provisions of subsection b. of section 2 of P.L.1999, c.94 (C.43:21-11.3), together with such information as may be necessary, to the Office of the Assistant Commissioner for Administration and Finance of the Department of Labor for deposit in the proper funds and accounts established pursuant to the "unemployment compensation law," R.S.43:21-1 et seq., and the "Temporary Disability Benefits Law," P.L.1948, c.110 (C.43:21-25 et seq.);

(2) Provisions for the apportionment of interest and penalties imposed between liabilities pursuant to the "New Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq. and those contributions treated as liabilities pursuant to the "New Jersey Gross Income Tax Act" pursuant to the provisions of subsection b. of section 2 of P.L.1999, c.94 (C.43:21-11.3), and forwarding the latter to the Office of the Assistant Commissioner for Administration and Finance and the Director of the Division of Accounting in the Department of Labor for deposit in the proper funds established pursuant to the "unemployment compensation law," R.S.43:21-1 et seq., and the "Temporary Disability Benefits Law," P.L.1948, c.110 (C.43:21-25 et seq.).

c. Notwithstanding the provisions of subsection a. of this section, an employer subject to the provisions of this section shall, within 10 days of the separation from employment of an employee in domestic service whose contributions are treated as taxes pursuant to the provisions of section 2 of P.L.1999, c.94 (C.43:21-11.3), report to the Commissioner of the Department of Labor, on a form determined by the commissioner, wage information for all completed calendar quarters of employment not previously reported and such other separation information as may be required to properly process an unemployment compensation claim.

d. For the purposes of this section, "domestic service" means domestic service as an employee in a private home of the employer, such as service as a babysitter, nanny, health aide, private nurse, maid, caretaker, yard worker or similar domestic employee.

C.43:21-11.3 Returns for domestic service filed on calendar year basis; exceptions.

2. a. Notwithstanding the provisions of subsection (a) of R.S.43:21-14 and subparagraph (E) of paragraph (1) of subsection (d) of R.S.43:21-7 to the contrary, except for an employer also liable for making or withholding contributions with respect to remuneration for services rendered other than for domestic service, returns reporting employer and employee contributions with respect to domestic service shall be filed on a calendar year basis. Such a return shall be filed on or before January 31 following the close of the calendar year, and the amount of contributions shall be paid over to the Director of the Division of Revenue in the Department of the Treasury at that time.

b. Notwithstanding the provisions of R.S.43:21-16 or any other law to the contrary, the contributions due pursuant to subsection a. of this section shall be treated as taxes due pursuant to N.J.S.54A:1-1 et seq., subject to the provisions of section 1 of P.L.1999, c.94 (C.54A:9-17.2).

c. The Commissioner of the Department of Labor, in consultation with Director of the Division of Revenue in the Department of the Treasury, shall prescribe such regulations as the commissioner deems necessary to carry out the purpose of allowing employers to convert from a quarterly system of payments and filing to annual filing, and to simplify employer filing by allowing the combination of unemployment compensation, disability benefits and gross income tax remittance for reporting and payment purposes for employees providing domestic services.

d. Notwithstanding the provisions of subsection a. of this section, an employer subject to the provisions of this section shall, within 10 days of the separation from employment of an employee in domestic service whose contributions are treated as taxes pursuant to the provisions of this section, report to the Commissioner of the Department of Labor, on a form determined by the commissioner, wage information for all completed calendar quarters of employment not previously reported and such other separation information as may be required to properly process an unemployment compensation claim.

e. For the purposes of this section, "domestic service" means domestic service as an employee in a private home of the employer, such as service as a babysitter, nanny, health aide, private nurse, maid, caretaker, yard worker or similar domestic employee.

C.43:21-11.4 Establishment of system of annual filings.

3. a. The Commissioner of Labor shall establish a system of annual filings to meet the alternative system requirements of paragraph (3) of subsection (a) of 42 U.S.C. s.1320b-7 on or before the 30th day after enactment of P.L.1999, c.94 (C.54A:9-17.2 et al.), and shall seek waiver from the United States Secretary of Labor in conformance with paragraph (3) of subsection (a) of 42 U.S.C. s.1320b-7.

b. Notwithstanding any other provisions of this act to the contrary, the powers of the commissioner pursuant to the provisions of subsection (g) of R.S.43:21-11 to require quarterly reports of wages paid are reserved to the commissioner, to be exercised after compliance with subsection a. of this section if necessary to maintain a State income and eligibility verification system in compliance with the requirements of paragraph (3) of subsection (a) of 42 U.S.C. s.1320b-7.

4. This act shall take effect immediately and apply to all wages paid on and after January 1 next following enactment.

Approved May 3, 1999.