How did Senate Bill 226 change Kansas withholding tax for payments other than wages effective July 1, 2000?

Plain-English summary

The 2000 Legislature's Senate Bill 226 amended Kansas withholding law effective July 1, 2000 to match federal practice -- so that, in almost all cases, there is Kansas withholding whenever there is federal withholding.

The core change adds withholding on 'payments other than wages' made by a 'payor' (any person or organization other than an employer) to a 'payee.' Payments subject to withholding include those for:

• supplemental unemployment compensation, annuity, or sick pay;
• a voluntary withholding agreement;
• gambling winnings;
• taxable Indian casino profits;
• vehicle fringe benefits;
• periodic, nonperiodic, or eligible-rollover distributions of pensions, annuities, and other deferred income.

Every payor that withholds federal income tax from a Kansas-resident payee must withhold Kansas tax on the Secretary's tables and remit on the same schedule as employer wage withholding. Most employers paying ordinary wages were unaffected -- amounts and payment dates were unchanged. The Department planned to revise the Kansas Withholding Tax Booklet to reflect the changes.

What this means for you

If you make non-wage payments to Kansas residents -- pensions and annuities, gambling winnings, sick pay, and similar amounts -- and you withhold federal income tax on them, you must also withhold Kansas tax and remit it like an employer. Ordinary employers paying wages saw no change in how much to withhold or when to pay.

Common questions

Q: Did this change how much employers withhold from regular wages?
A: No. The amounts withheld from wages and the payment due dates were not changed; most employers continued their normal routines.

Q: Are gambling winnings subject to Kansas withholding?
A: Yes. Senate Bill 226 lists gambling winnings among the 'payments other than wages' subject to Kansas withholding by the payor when federal tax is withheld from a Kansas resident.

Citations and references

• 2000 Senate Bill 226 (Kansas withholding tax amendments effective July 1, 2000)

Subject

Kansas Withholding Tax

Source

• Landing page: Kansas Department of Revenue Policy Information Library
• Original document: Notice 00-03

Original ruling text

Notice
Notice Number: 00-03
Tax Type: Withholding and Declaration of Estimated Tax
Brief Description: Kansas Withholding Tax
Keywords:
Effective Date: 07/01/2000
Approval Date: 07/01/2000

Body:

                                                NOTICE 00-03


                                           Kansas Withholding Tax

The 2000 Kansas Legislature enacted Senate Bill 226, which includes changes to several Kansas withholding tax
laws. These changes become effective July 1, 2000.

Most employers who are paying wages to employees will not be affected by this legislation. The amount to be
withheld from wages and the dates on which withholding tax is to be paid to the state have not been changed.
Employers should continue to follow their normal routines and procedures.

The purpose of the amendments and new provisions is to bring Kansas into closer conformity with federal law so that,
in almost all cases, there is withholding for Kansas purposes whenever there is withholding for federal purposes. The
primary change in this regard is the addition of language to specifically provide for withholding on “payments other
than wages” that are made by “payors” to “payees.”

A “payor” is any person or organization, other than an employer, who makes payments that are subject to withholding
tax. Payments subject to withholding tax include payments:

 · for any supplemental unemployment compensation, annuity, or sick pay;
 · pursuant to a voluntary withholding agreement;
 · on gambling winnings;
 · on taxable payments of Indian casino profits;
 · for any vehicle fringe benefit;
 · on periodic payments of pensions, annuities, and other deferred income;
 · on nonperiodic distributions of pensions, annuities, and other deferred income, or
 · on eligible rollover distributions of pensions, annuities, and other deferred income;

Every payor who withholds federal income tax from payments made to those persons whose primary residence is in
Kansas shall deduct and withhold Kansas tax, calculated on the basis of the withholding tax tables prescribed by the
secretary. Remittance of tax to the state is to be made on the same schedule as for taxes withheld by employers from
employess.

The Department intends to revise the Kansas Withholding Tax Booklet to include additional information concerning
the changes and amendments made by this legislation. The revised Booklet should be available by late summer or
early fall.

To obtain additional copies of this or any other notice call the Kansas Department of Revenue’s voice mail forms
request line at (785) 296-4937 or download them from our web site: www.ink. org/public/kdor. If you have any
questions about this notice, please contact a customer service representative in our Topeka Assistance Center.

Topeka Location. The Kansas Department of Revenue is located in the Docking State Office Building, 915 SW

Page 2

Harrison St., Topeka, KS 66612. Our Taxpayer Assistance Center is on the 1st Floor. The Topeka telephone number is
785-368-8222; the Fax number is 785-291-3614.

Date Composed: 07/03/2000 Date Modified: 10/10/2001

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