On May 7, 2009, legislation was enacted creating the Metropolitan Commuter Transportation Mobility (MCTM) tax – a new employer-paid payroll tax – as part of a bailout plan for the Metropolitan Transportation Authority (MTA), which manages buses, trains, bridges, and tunnels in New York City and surrounding areas.

• you’re required to withhold New York State income tax from wages; and
• your payroll expense exceeds $2500 in any calendar quarter

The tax rate is 0.34% of an employer’s total payroll expense for employees employed within the MCTD (i.e. $0.34 per $100 of wages).  An employer that is required to deduct and withhold NY State income tax from employees’ wages and has a payroll expense of exceeding $2,500 in any calendar quarter is required to pay the MCTM tax.  The United Nations, federal government, and interstate agencies or public corporations created pursuant to an agreement between two or more states or with Canada are excluded.

• For quarterly filers, the first payment is due with the third quarterly withholding payment on October 31, 2009, and is to include all tax owed since March 1.
• For EFT filers, the first payment is due with the first withholding payment due on or after October 31, 2009, and is also to include all tax owed since March 1.

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