State Picture
  

Frequently Asked QuestionsChild

Potential Non-compliance Letter FAQs    new NEW!
1. I have been in business for many years and have not heard of this law.
2. I only employ a domestic worker.
3. I am a sole proprietor, but my family works for me. Do I have to report them?
4. I am a sole proprietor, but have one or more employees that are not related to me; do they need to be reported?
5. I am a sole proprietor with a limited liability company that is not classified as a corporation for federal tax purposes, do I need to report the relatives that work for me?
6. I only get paid quarterly or on a varying schedule.
7. My employee will continue to have breaks in pay. Why must I report every time?
8. This person has already quit or been terminated.

About the Law
9. What is the new hire law?
10. Who must report?
11. Who must be reported?
12. Is anyone exempt from this law?
13. Do Independent Contractors (1099's) have to be reported?
14. Are labor unions and hiring halls required to report?

Basics of New Hire Reporting
15. Why do we need new hire reporting?
16. What information must I report?
17. How do I report?
18. Where do I report new hires?
19. How often must I report?
20. How will the information be used?
21. I've never reported new hires, what do I do?

Common Employer Questions
22. I am an employer with employees in more than one state. What special considerations, if any, need to be made for this?
23. Is there an easier way to report other than submitting a New Hire Reporting Form?
24. Do I have to report if I do not hire anyone?
25. I am an employer who has more than one address. Which one should I list?
26. I provide employee information on my Quarterly Wage Reports. Why must I also report the employee as a new hire?
27. Do temporary agencies have to report their new hires for every assignment?
28. Do I need to report an employee who worked for a couple of hours or days and then quit?
29. Do I have to include my FEIN on line 10 of the W-4? The instructions say to include it only if I sent it to the IRS.
30. If I take over a business, do I have to report all of the employees?
31. In addition to reporting new hires, do I need to report terminated employees as well?
32. Can I send an outdated W-4?
33. I am a multistate employer reporting employees who do not work in Maryland to the Directory. What SUIN do I report for out-of-state employees?
34. May an employer report new employees prior to their first day of work?
35. I am a new employer in Maryland and am in the process of applying for a State Unemployment Insurance Account Number (SUIN). What SUIN do I report?
36. I am exempt from coverage under the Maryland Unemployment Insurance Program and don't have a SUIN. If I choose to report to the Directory, what SUIN do I report?
37. I do not know my SUIN. How can I get help?
38. How can an employer verify that the Directory received the submitted information?
39. Is there a penalty for not reporting?
40. What if I still have more questions about new hire reporting?

Child Support Payments    
41. What are the Maryland State Withholding Limits?
42. Does the Non-Custodial Parent have to provide insurance?
43. How much should the employer take out for insurance?
44. How should the employer proceed with filling out the National Medical Support Notice (NMSN) or 1078 form?
45. Does the employer need to implement insurance (if Non-Custodial Parent is eligible) regardless of open enrollment timing?
46. What if I have more questions about child support or income withholding?

 


Potential Non-compliance Letter FAQs   new NEW!

1. I have been in business for many years and have not heard of this law.

The Maryland State Directory of New Hires is housed within the Maryland Department of Human Resources. The Federal Program was enacted in 1996, 42 U.S. Code § 653A. The provisions are for every Maryland employer to furnish to the State New Hire Directory, federally identified elements for every new or rehired employee to their company.

Back to Top

2. I only employ a domestic worker.

As they are an employee who is receiving pay they must be reported to New Hire.

Back to Top

3. I am a sole proprietor, but my family works for me. Do I have to report them?

The following persons employed by a sole proprietor are not engaged in covered employment and therefore do not need to be reported:

  • The sole proprietor;
  • A spouse of the sole proprietor;
  • Children of the sole proprietor under the age of 21; and
  • Parents of the sole proprietor

Back to Top

4. I am a sole proprietor, but have one or more employees that are not related to me; do they need to be reported?

A person performing services for wages for a sole proprietorship is engaged in covered employment and therefore must be reported.

Back to Top

5. I am a sole proprietor with a limited liability company that is not classified as a corporation for federal tax purposes, do I need to report the relatives that work for me?

If you are the sole proprietor of a limited liability company not classified as a corporation for federal tax purposes, the following person employed by the single member limited liability company are not engaged in covered employment and therefore do not need to be reported:

  • The single member;
  • The spouse of the member;
  • Children younger than 21 years old of the member; and
  • Parents of the member

Back to Top

6. I only get paid quarterly or on a varying schedule.

Any time there is a break in pay of 60 days or greater the employee must be reported each additional time to us.

Back to Top

7. My employee will continue to have breaks in pay. Why must I report every time?

Any time there is a break in pay of 60 days or greater the employee must again be reported to us. Failure to do so will cause you to continue to receive the warning notices on a quarterly basis.

Back to Top

8. This person has already quit or been terminated.

If they were employed by you during the quarter mentioned in the notice they must still be reported.

Back to Top

About the Law

9. What is the new hire law?

Maryland State Senate Bill 541 and the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) of 1996, 42 U.S.C. 653a, requires all employers to report newly hired and re-hired employees to a state directory within 20 days of their hire or re-hire date.

Back to Top

10. Who must report?

As of July 1, 1997, all employers and/or labor organizations in the State of Maryland who are covered by the Maryland Unemployment Insurance law are required to report new employees to the Directory.

Back to Top

11. Who must be reported?

Employers are required to report the following employees:

  • New employees: Employers must report all employees who reside or work in the State of Maryland to whom the employer anticipates paying earnings. Employees should be reported even if they work only one day and are terminated (prior to the employer fulfilling the new hire reporting requirement).
  • Re-hires or Re-called employees: Employers must report re-hires, or employees who return to work after being laid off, furloughed, separated, granted a leave without pay, or terminated from employment. Employers must also report any employee who remains on the payroll during a break in service or gap in pay, and then returns to work. This includes teachers, substitutes, seasonal workers, etc.
  • Temporary employees: Temporary agencies are responsible for reporting any employee who they hire to report for an assignment. Employees need to be reported only once; they do not need to be re-reported each time they report to a new client. They do need to be reported as a re-hire if the worker has a break in service or gap in wages from your company.

Back to Top

12. Is anyone exempt from this law?

All newly hired employees must be reported to the Directory. A new employee is an individual who is eligible for federal income tax withholding from wages and provides a service to the employer. This includes employees who work less than a full day, are part-time employees, are seasonal employees, or employees who discontinue their employment prior to being reported to the Directory. Even employers having only household and/or domestic employees are required to report those employees.

Back to Top

13. Do Independent Contractors (1099's) have to be reported?

The Directory welcomes Independent Contractor reports, however, the law does not require employers to report them. The IRS provides strict guidelines on whether an individual is in fact an Independent Contractor or an employee. If you have questions regarding this guideline, please contact the IRS.

Back to Top

14. Are labor unions and hiring halls required to report?

Labor unions and hiring halls must report their own employees; that is, individuals who work directly for the labor union or hiring hall. If the labor union or hiring hall simply refers individuals for employment, it does not need to file new hire reports for these actions. If a labor organization actually pays the individuals whom it refers (as opposed to having them paid by the person or entity to whom they have been referred), the labor organization would be considered the "employer" and subject to the new hire reporting requirements.

Back to Top

Basics of New Hire Reporting

15. Why do we need new hire reporting?

New hire reporting speeds up the child support income withholding order process, expedites collection of child support from parents who change jobs frequently, and quickly locates alleged fathers/non-custodial parents to help in establishing paternity and child support orders. New hire reporting helps children receive the support they deserve. Employers are a key partner in ensuring financial stability for many children and families and should take pride in their role.

Back to Top

16. What information must I report?

In accordance with Federal legislation, the State of Maryland asks for the following information:

  • Employer Federal Employer Identification Number (FEIN) - If you have more than one FEIN, please make certain you use the same FEIN you use to report your quarterly wage information when reporting new hires.
  • Employer State of Maryland Unemployment Insurance Number (SUI)
  • Employer Name
  • Employer Address
  • Employee Social Security Number (SSN)
  • Employee Name
  • Employee Address
  • Employee First Day of Work
  • Employee Availability of Medical Benefits
  • Employee Salary and Pay Frequency

Optional data elements include

  • Employee Date of Birth
  • Employee Gender

Additional information may be required if reporting electronically. Please click here for electronic reporting specifications.

Back to Top

17. How do I report?

There are a variety of ways to report new hires, including online reporting, electronic reporting and by mail or fax. For more information on the convenient reporting options available, click here

Back to Top

18. Where do I report new hires?

Electronic Reports - Using our Web site's online reporting feature is a very popular choice for employers. This feature provides a printable confirmation of reports received and is available 24 hours a day, 7 days a week.

Employers can send new hire data files in a variety of ways, including transferring files through this Web site, electronic transfer via modem (EFT), or mail reports to the Maryland State Directory of New Hires on diskette. Click here to learn more about electronic reporting.

Non-Electronic Reports - Paper new hire reports may either be faxed or mailed to the Directory.

Mail reports to:
Maryland State Directory of New Hires
P.O. Box 1316
Baltimore, MD   21203-1316
Fax reports to:
(410) 281-6004
Toll-free: (888) 657-3534

Back to Top

19. How often must I report?

Employers must report within 20 days of a new employee's hire date. Employers who submit reports magnetically or electronically shall submit the reports in two monthly transmissions not more than 16 days apart. 

Back to Top

20. How will the information be used?

Federal and State laws contain strict guidelines for the use of new hire reporting information. Maryland's child support computer system matches new hire information against open child support cases to locate alleged fathers/non-custodial parents to establish paternity and child support orders, and enforce existing orders. Once these matches are done, the new hire information is sent to the National Directory of New Hires and is utilized by Child Support Agencies nationwide.

New hire information can also be used by states to help detect and prevent fraudulent payments to recipients of unemployment insurance, workers compensation, and welfare benefits.

The use of this information provides financial support for Maryland's families and a reduction in welfare and unemployment insurance costs. 

Back to Top

21. I've never reported new hires, what do I do?

Begin by reporting any new employees you've hired within the last 180 days. Continue by reporting any new hires you have within 20 days of their hire date.

Back to Top

Common Employer Questions

22. I am an employer with employees in more than one state. What special considerations, if any, need to be made for this?

New hire reporting is required in all 50 states. One of the goals of new hire reporting legislation is to make it as easy as possible for employers to comply. For those employers with employees in more than one state, we have two convenient options for reporting. Click here for more information about Multistate reporting.

Back to Top

23. Is there an easier way to report other than submitting a New Hire Reporting Form?

We strongly suggest reporting electronically. You can either report new hires using our Web site or transmit a data file created by your company's human resources or payroll software. Electronic reporting will eliminate paperwork, increase the accuracy of the reports, allows faster processing, and can save on postage and other costs. Our Web site even provides a printable confirmation of new hires you report during a session! Electronic reporting can also qualify Multistate employers to report new hires directly to one state.

Back to Top

24. Do I have to report if I do not hire anyone?

No.

Back to Top

25. I am an employer who has more than one address. Which one should I list?

The address where you want income withholding orders sent should be used. A street address is preferred, as long as you can receive mail there.

Back to Top

26. I provide employee information on my Quarterly Wage Reports. Why must I also report the employee as a new hire?

New hire information from the Quarterly Wage Reports becomes available two to six months after the date of hire. When you immediately report new hires, there is an improved chance of locating the individual while employed and the required child support action can be promptly taken. In addition, fraudulent unemployment insurance, workers compensation, and welfare benefit payments can be quickly detected.

Back to Top

27. Do temporary agencies have to report their new hires for every assignment?

Temporary agencies are responsible for reporting their workers who sign a W-4 form and report to an assignment. Workers need to be reported only once; they do not need to be reported each time they report to a new client. If the worker has a break in service from your agency and a new W-4 form is required, then a new hire report is also needed.

Back to Top

28. Do I need to report an employee who worked for a couple of hours or days and then quit?

If the employee filled out a W-4 form and only worked for a few hours, that employee must be reported. Although that employee is no longer with your company, there is useful information that can be obtained, such as home address and work history.

Back to Top

29. Do I have to include my FEIN on line 10 of the W-4? The instructions say to include it only if I sent it to the IRS.

Yes, if you are sending in your report by W-4, you must include the employer name, address, and Federal Employer Identification Number (FEIN) in blocks 8 and 10 of the W-4 form. If you have more than one FEIN, please make certain you use the same FEIN you use to report your quarterly wage information when reporting new hires.

Back to Top

30. If I take over a business, do I have to report all of the employees?

No, not if these employees have previously been reported. Employers must report any newly hired employee who is hired after that date. If you are unsure if employees have been previously reported, we recommend reporting any employee hired within the last 180 days.

Back to Top

31. In addition to reporting new hires, do I need to report terminated employees as well?

No. Only new hires and re-hires are required to be reported to the Directory. However, if the terminated employee had an Income Withholding Order for child support, the termination should be reported to the agency that issued the Order.

Back to Top

32. Can I send an outdated W-4?

Yes, but if you need new W-4 forms, please contact the Internal Revenue Service.

Back to Top

33. I am a multistate employer reporting employees who do not work in Maryland to the Directory. What SUIN do I report for out-of-state employees?

When reporting out-of-state employees to the Directory, multistate employers may either report the employer's Maryland SUIN or indicate "outofstate" in the SUIN data field. Reporting out-of-state employees to the Directory does not effect quarterly wage reporting.

Back to Top

34. May an employer report new employees prior to their first day of work?

Yes. An employer should report the anticipated start date as the employee's first day of work.

Back to Top

35. I am a new employer in Maryland and am in the process of applying for a State Unemployment Insurance Account Number (SUIN). What SUIN do I report?

Employers who are required to participate in Maryland's Unemployment Insurance Program but do not yet have an SUIN should indicate "appliedfor" in the SUIN data field.

Back to Top

36. I am exempt from coverage under the Maryland Unemployment Insurance Program and don't have a SUIN. If I choose to report to the Directory, what SUIN do I report?

Employers who do not participate in Maryland's Unemployment Insurance Program and therefore do not have an SUIN should indicate "exempt" in the SUIN data field.

Back to Top

37. I do not know my SUIN. How can I get help?

The Maryland Unemployment Insurance program has an employer help desk that can be reached at (800) 492-5524.

Back to Top

38. How can an employer verify that the Directory received the submitted information?

Forty-eight hours after receiving a report, the Directory's Help Desk is able to verify that it has been received and processed. Employers may contact the Help Desk at (410) 281-6000 or toll-free (888) 634-4737.

Back to Top

39. Is there a penalty for not reporting?

Maryland law authorizes penalties for employers who refuse to participate in the program once they have been notified of their responsibilities. An employer can be fined $20 per unreported employee and $500 per unreported employee if the employee and employer conspired to not provide the required information. Employers will receive a written warning and an opportunity to provide the required information prior to being fined.

Back to Top

40. What if I still have more questions about new hire reporting?

Do not hesitate to call the Maryland State Directory of New Hires at (410) 281-6000, or toll-free at (888) 634-4737 with any questions regarding the new hire reporting process. Our help desk staff is available Monday through Friday, 8:00am to 5:00pm Eastern Time. Our toll-free number operates 24 hours a day, seven days a week.

Back to Top

Child Support Payments

41. What are the Maryland State Withholding Limits?

MARYLAND STATE WITHHOLDING LIMITS:

  • If the non-custodial parent is SUPPORTING A SECOND FAMILY IN HIS HOUSEHOLD, the maximum deduction is 50%.

  • If the non-custodial parent is SUPPORTING A SECOND FAMILY IN HIS HOUSEHOLD and HAS ARREARS PAST 12 WEEKS the maximum deduction is 55%.

  • If the non-custodial parent is NOT supporting a second family IN HIS HOUSEHOLD, and does NOT have arrears past 12 weeks, the maximum deduction is 60%.

  • If the non-custodial parent is NOT supporting a second family IN HIS HOUSEHOLD and HAS ARREARS PAST 12 WEEKS, the maximum deduction is 65%.

*These withholding limits are to be applied ONLY if the Non-custodial Parent/Employee makes insufficient income to meet his/her full support order amount of Child Support as indicated in the Wage Withholding Order(s) you receive.

*Withholding Limits pertain to one lump sum from the Non-custodial Parent's income to be submitted by you (Employer) to CSE. This agency will distribute the amount submitted to the Non-custodial Parent/Employee's case(s).

*W-4 forms can be used to verify the members of the Non-Custodial Parent/Employee's household.

*Children living within the Non-Custodial Parent/Employee's home MUST be linked THROUGH PATERNITY/ MATERNITY to the Non-Custodial Parent to be considered as children supported within household.

Back to Top

42. Does the Non-Custodial Parent have to provide insurance?

Yes, in general/most cases, the Court stipulates that Non-Custodial Parent does have to provide health coverage through employer for the child(ren) in the child support case.

Back to Top

43. How much should the employer take out for insurance?

The amount that can be withheld from an employee’s disposable wages is limited by the Federal Consumer Credit Protection Act (FCCPA) to 50 percent of disposable earnings if an obligated parent has a second family and 60 percent if there is no second family. These limits are each increased by 5 percent (to 55% and 65%) if payments are in arrears for a period equal to 12 weeks or more. State law may further limit the amount that can be taken form a wage paycheck.

This amount is in conjunction with health insurance. Hence, the Non-Custodial Parent is obligated to provide health insurance through his/her employer IF it is a reasonable cost and applies to the above standards.

Back to Top

44. How should the employer proceed with filling out the National Medical Support Notice (NMSN) or 1078 form?

As set forth in the Health Insurance Reporting (1078) & National Medical Support Notice (NMSN, the employer’s response should be one of the following:

   __ YES, the child(ren) has been enrolled, and the required information is provided.
   __ YES, the child(ren) will be enrolled, and the expected date of coverage and required information is provided.
   __ NO, the child(ren) could not be enrolled because:

  • [  ] 1. Employer does not maintain or contribute to plans providing dependent or family health care coverage.

  • [  ] 2. The employee is among a class of employees (for example, part -time or non-union) that are not eligible for family health coverage under any group health plan maintained by the employer or to which the employer contributes.

  • [  ] 3. Health care coverage is not available because the employer no longer employs employee.

  • [  ] 4. State or Federal withholding limitations and/or prioritization prevent the withholding from the employee’s income of the amount required to obtain coverage under the terms of the plan.

Back to Top

45. Does the employer need to implement insurance (if Non-Custodial Parent is eligible) regardless of open enrollment timing?

Yes.

Back to Top

46. What if I have more questions about child support or income withholding?

The Maryland State Directory of New Hires does not have access to specific child support information and does not have the ability to answer questions related to child support.

Check out our Employer Resource Center page to find information on local, state, and federal child support agencies

Back to Top


   Contact Us | Privacy Policy

© 2012 MAXIMUS. All rights reserved.