Minnesota Department of Revenue

1. MinnesotaDepartmentofRevenue Karen Kittel, Business Education Coordinator Income Tax and Withholding Division karen.kittel@state.mn.us 651-556-3668 www.revenue.state.mn.us

2. Disclaimer This presentation is for educational purposes only. It is meant to accompany an oral presentation and not be used as a standalone document. This presentation is based on the facts and circumstances being discussed, and on the laws in effect when it is presented. It does not supersede or alter any provisions of Minnesota laws, administrative rules, court cases, or revenue notices.

3. Today’s Topics Legislative Changes for Withholding Tax • No law changes affecting Withholding Tax Department Initiatives and Priorities • Information Security • Agency wide Outreach Efforts What’s New for Withholding Tax? • Withholding Tax Calculator • W-2 and 1099 Changes

4. Department Initiatives and Priorities

5. Information Security

6. Identity Theft What is Identity Theft? When someone wrongfully obtains another person’s personally identifying information (PII) and uses the information to commit fraud or other crimes. PII is your name, Social Security number, banking information, date of birth, home address, etc.

7. Identity Theft How do thieves get your PII? • Dumpster diving • Working at a job with access to PII • Phishing phone calls or emails • Stealing a victim’s wallet, purse, backpack, or mail • Requesting PII to “qualify” for a job, loan, or apartment

8. Identity Theft What does identity theft have to do with taxes? Historically, the most common forms of identity theft involved credit cards and bank accounts. Today, one of the largest expansions of identity theft relates to tax fraud. Identity thieves can use PII to file a tax return to get a refund, to gain employment, or other benefits.

9. Identity Theft What if you’re a victim of identity theft? You should contact the: • Federal Trade Commission (FTC) at IdentityTheft.gov • Internal Revenue Service at irs.gov • Minnesota Department of Revenue at 651 - 296-3781 or 1-800- 652-9094 (toll-free) Awareness is the best fraud prevention tool. For tips on protecting your identity, go to: www.irs.gov/individuals/identity-protection-tips

10. Two-step Verification ​What is two-step verification? Currently, you enter a username and password to log in to e-Services. Beginning September 7, you must enter a username, password, and verification code we send you to access your account. This is called two-step verification. You will select how you want to receive the verification code: a text message or email.

11. Two-step Verification Why are we adding two-step verification? We take the responsibility of protecting your information seriously. This process adds another layer of security to prevent unauthorized access to your account.

12. Two-step Verification To set up two-step verification: • Log in to e-Services with your username and password. • Review your profile information. If needed, make updates. • Complete your verification contact information and choose how to receive the verification code. • Select Save. • Log out of e-Services. Your verification preference is now set.

13. Two-step Verification How does it work? The next time you log in to your account, you must enter your username, password, and a verification code. Every person using e-Services for businesses is required to have their own username and password, even if they are taking actions for another customer. For more information on two-step verification, go to www.revenue.state.mn.us and type verification code into the Search box.

15. Agency wide Outreach

16. What is Outreach? Voluntary education activities that provide information to help customers understand and comply with tax laws. • Classes/Trainings • Presentations • Special events • Vendor visits

17. Why create an outreach team? We want to better serve our customers: • Increase collaboration • Streamline our processes • Share resources • Provide clear and consistent messages

18. Outreach events Provide customer education and services. • Education classes • Military events • Free tax preparation sites • State Fair, county fairs • Social media/email updates

19. Working together Collaborative team efforts: • Agency wide tax due date calendar • Education and outreach calendar • New business resource center • Gathering feedback • Reporting tools

20. Find tax classes and workshops www.revenue.state.mn.us

21. What’s New for Withholding?

22. Withholding Tax Calculator This tool can help calculate withholding tax on: • Regular wages (employee payroll) • Supplemental payments (overtime, commissions, and bonuses) • Payments made for personal services • Payments dated “2009, to end of current year”

24. Withholding Tax Calculator

25. Withholding Tax Calculator

28. Form W-2 and 1099 Changes • W-2 changes –If errors exist in your file, it will not upload to our system. You need to review the error codes, make all corrections, and then submit your file. • 1099 changes – We no longer accept 1099 information on disc (CD). You are now required to send your information electronically.

29. W-2 Submissions You can submit W-2 information electronically using our: • e-Services System • Upload delimited file – file format available on Revenue website • Upload EFW2 file – available on SSA website • Key and send – save and finish later function • Electronic Data Exchange System – upload files greater than 2MB (about 2000+ records) For more information, see Withholding Fact Sheets 2 and 2a

30. 1099 Submissions You can submit 1099 information electronically using our: • e-Services System • Upload delimited file – file format available on Revenue website • Upload 1220 file – specifications available on IRS website • Key and send – save and finish later function • Electronic Data Exchange System – upload 1220 files greater than 2MB (about 2000+ records) For more information, see Withholding Fact Sheets 2 and 2a

31. W-2 and 1099 Requirements • Give W-2s to employees and 1099s to workers by Jan. 31. • Send all W-2s, and any 1099s with Minnesota withholding to us by Feb. 28. • Submit information electronically • required if you have more than 10 forms • encouraged if you have 10 or fewer

32. Connecting with Customers

33. Connecting with Customers When you subscribe to the department’s email updates you can: • Choose updates by tax and publication type • Choose how often you get updates • Sign in directly or using your social media account – Facebook, Yahoo! or Google

34. Connecting with Customers Examples of subscription topics: • What’s New – press releases, tax law changes, disaster relief information, tax scams/ fraud alerts • Businesses – information for businesses, opportunities to give us feedback (participate in usability testing) • Individuals – individual income tax updates (know what changes may affect you and your employees) • Withholding Tax – employer information (may choose quarterly, annual, third-party bulk filer)

35. Connecting with Customers Withholding Tax Contact Information Email: withholding.tax@state.mn.us Phone: 651-282-9999 or 1-800-657-3594 Website: www.revenue.state.mn.us Thank you!