Notice

Notice Number:16-03
Tax Type:Withholding and Declaration of Estimated Tax
Brief Description:Withholding on Payments Made to Personal Care Service Providers By Self-Directing Participants Authorized for Services
Keywords:
Effective Date:04/11/2016
Approval Date:04/11/2016


Body:
Notice 16-03


Withholding on Payments Made to Personal Care Service Providers
By Self-Directing Participants Authorized for Services

Information for Individuals and Financial Management Service Providers

(April 11, 2016)


Advice has been requested regarding Kansas withholding on payments made to personal care service providers. This Notice addresses that topic.

The Kansas Department for Aging and Disability Services has established Policy and published information that defines Personal Care Services (PCS) and specific limitations that apply. The General policy statement provides, in part:
The Policy established Kansas Department for Aging and Disability Services also defines certain terms. The term “Self-direction” is defined as:
A self-directing participant who employs one or more personal care service providers is considered to be an employer for purposes of Kansas income tax withholding. As a result, the participant is required to register with the Kansas Department of Revenue, withhold tax from the wages they pay their employee(s), and remit the tax to the Department of Revenue.

Instead of dealing with all of the requirements typically imposed on an employer, many self-directing participants choose to use a financial management service (FMS) provider to handle these duties, including the responsibilities associated with Kansas withholding tax. On behalf of their client the FMS provider is required to register with the Kansas Department of Revenue, withhold tax from the wages they pay their employee(s), and remit the tax to the Department of Revenue.

Details of the withholding tax process are provided in the Department’s publication KW-100 Kansas Withholding Tax Booklet which is available through the Department’s website at: http://www.ksrevenue.org/pdf/kw1002015.pdf#search=KW-100. An outline of the process, with important contact information, is provided below.


Individual Account Registration
Making Withholding Payments

All Withholding tax returns must be submitted electronically. Because a Withholding payment cannot be remitted without an associated KW-5 return, all Withholding payments must be submitted electronically. There are two options for electronically filing and paying Withholding tax:
End of Year Reports and Returns
Taxpayer Assistance

Additional copies of this notice, forms or publications are available from our web site, www.ksrevenue.org. If you have questions about this Notice, please contact:
Taxpayer Assistance Center
Kansas Department of Revenue
915 SW Harrison St., 1st Floor
Topeka, KS 66612-1588
Phone: 785-368-8222
Hearing Impaired TTY: 785-296-6461
Fax: 785-291-3614




Date Composed: 04/12/2016 Date Modified: 04/12/2016