SUBCHAPTER 24D - TAX ADMINISTRATION

 

SECTION .0100 – Requests for noncharging of benefit payments

 

04 NCAC 24D .0101          NOTICE OF CLAIM TO EMPLOYER

Upon receipt of a claim for benefits filed by a claimant, DES shall notify the claimant's last employer and all base period employers of the claim filed. 

 

History Note:        Authority G.S. 96-4; 96-11.4; 96-15;

Eff. July 1, 2015.

 

04 NCAC 24D .0102          NOTICE TO EMPLOYER OF POTENTIAL CHARGES

(a)  DES shall notify each employer in writing of potential charges to the employer's account.  The notice shall contain the:

(1)           date of the notice;

(2)           claimant's name and social security number;

(3)           date the claimant's benefit year began;

(4)           claimant's weekly benefit amount and weekly earnings allowance;

(5)           employer's reporting number used to report wages for the claimant;

(6)           base period wages reported by the employer by calendar quarter and dollar amount;

(7)           employer's percentage of total base period wages reported;

(8)           maximum potential charge amount that can be applied to the employer's experience rating account if the claimant exhausts his or her benefits;

(9)           a statement containing the employer's right to protest the notice; and

(10)         the time period within which a protest shall be filed pursuant to G.S. 96-15(b)(2).

(b)  Notice of potential charges to the employer's account shall be provided using the following forms, as applicable:

(1)           Notice of Combined Wage Claim and Potential Charges to Your Account (Form NCUI 551C);

(2)           Notice of Unemployment Claim, Wages Reported and Potential Charges (Form NCUI 551L);

(3)           Notice of Initial Claim and Potential Charges to Reimbursable Employer (Form NCUI 551R);

(4)           Notice of Initial Claim and Potential Charges for Claimants on Temporary Layoff (Form NCUI 551T);

(5)           Reversal of Previously Allowed Noncharging (Form NCUI 553A);

(6)           Reversal of Previously Denied Noncharging (Form NCUI 554);

(7)           Administrative Determination Disallowing Noncharging (Form NCUI 570); or

(8)           List of Charges to Your Account (Form NCUI 626).

 

History Note:        Authority G.S. 96-4; 96-11.1; 96-11.2; 96-11.3; 96-11.4; 96-15;

Eff. July 1, 2015.

 

04 NCAC 24D .0103          REQUIREMENTS FOR REQUESTING NONCHARGING OF BENEFIT PAYMENTS

An employer who requests noncharging of benefit charges shall make the request by stating each reason for the request in writing within 15 days of the mailing date of the notice of potential charges to DES's Claims Unit, pursuant to 04 NCAC 24A .0104(s).

 

History Note:        Authority G.S. 96-4; 96-11.3;

Eff. July 1, 2015;

Recodified from 04 NCAC 24D .0201 Eff. March 1, 2017;

Amended Eff. October 1, 2017.

 

04 NCAC 24D .0104          TIME FOR FILING requests for Noncharging

The provisions of 04 NCAC 24A .0106 shall apply in determining timeliness of a protest.

 

History Note:        Authority G.S. 96-4; 96-11.3; 96-11.4;

Eff. July 1, 2015.

 

04 NCAC 24D .0105          DETERMINATION ON REQUESTS FOR NONCHARGING

DES shall render a determination in writing as to each request for noncharging.  The determination shall contain notice of whether the request for noncharging has been granted or denied.

(1)           Where a request for noncharging is granted, the employer's account shall be protected from benefit charges for benefit payments made after the last day that the claimant worked, based on wages reported by the employer before the claimant separated from the employer.

(2)           Where a request for noncharging is denied, the determination shall contain:

(a)           the reason(s) for denying the request;

(b)           the mailing date of the determination;

(c)           the time period within which a protest of the denial must be filed; and

(d)           instructions for protesting the denial to the Employer Benefit Charges/Benefit Charges Unit by mail to Post Office Box 25903, Raleigh, North Carolina 27611-5903, or facsimile to (919) 733-1126.

 

History Note:        Authority G.S. 96-4; 96-11.1; 96-11.3; 96-11.4;

Eff. July 1, 2015;

Recodified from 04 NCAC 24D .0202 Eff. March 1, 2017.

 

04 NCAC 24D .0106          APPEALING DENIAL OF REQUEST FOR NONCHARGING

(a)  The employing unit may file an appeal following an unsuccessful protest of a request for noncharging.

(b)  Employers shall direct all appeals from denials of a request for noncharging to the Appeals Section.

The provisions of 04 NCAC 24A .0204 shall apply in determining timeliness of an appeal.

(c)  Hearings on the denial of noncharging shall be conducted pursuant to the provisions of 04 NCAC 24C .0209.

 

History Note:        Authority G.S. 96-4; 96-11.3; 96-11.4;

Eff. July 1, 2015;

Recodified from 04 NCAC 24D .0203 Eff. March 1, 2017.

 

SECTION .0200 - ACCOUNT CHARGE PROTESTS

 

04 ncac 24d .0201          RESERVED FOR FUTURE CODIFICATION

 

04 NCAC 24D .0202          REQUIREMENTS FOR FILING PROTESTS to LIst of charges

(a)  An employer who protests the benefit charges to its account shall make the protest in writing within 15 days of the mailing date of the notice of potential charges to DES's Claims Unit in accordance with 04 NCAC 24A .0104(s), and shall list all grounds for the protest as prescribed under Rule .0203 of this Section.

(b)  Any of the following forms, when completed with the information indicated in Paragraph (a) of this Rule, shall constitute compliance with this Rule:

(1)           Notice of Initial Claim and Potential Charges to Your Account; and

(2)           Notice of Combined Wage Claim and Potential Charges to Your Account.

 

History Note:        Authority G.S. 96-4; 96-11.3; 96-11.4;

Eff. July 1, 2015;

Recodified from 04 NCAC 24D .0103 Eff. March 1, 2017;

Amended Eff. October 1, 2017.

 

04 NCAC 24D .0203          GROUNDS FOR PROTESTING LIST OF CHARGES

An employer shall only file protests for the following reasons:

(1)           clerical errors in the list of charges;

(2)           charges resulting from individuals who were never employed by the employer; or

(3)           the claimant has new separation from employment occurring between the date that the claimant's benefit year began and the last week ending date for which the claimant was paid benefits, and a base period employer did not have an opportunity to request noncharging on the subsequent separation.

 

History Note:        Authority G.S. 96-4; 96-11.3; 96-11.4; 96-11.5;

Eff. July 1, 2015;

Recodified from 04 NCAC 24D .0105 Eff. March 1, 2017;

Amended Eff. October 1, 2017.

 

04 NCAC 24D .0204          DES'S RESPONSIBILITIES UPON RECEIPT OF PROTEST to List of Charges

(a)  DES shall review the employer's account charges and investigate the accuracy of the charges based on the reasons provided by the employer in the protest.

(b)  Upon completion of its review, DES shall issue a written determination of its findings based on the reasons provided by the employer in the protest.

 

History Note:        Authority G.S. 96-4; 96-11.4;

Eff. July 1, 2015;

Recodified from 04 NCAC 24D .0106 Eff. March 1, 2017.

 

04 NCAC 24D .0205          DETERMINATION ON GROUNDS CONTAINED IN PROTEST

The determination by DES shall contain:

(1)           notice of whether the relief sought by the employer in the protest was granted or denied;

(2)           any adjustments that have been made to the list of charges if the relief sought in the protest was granted, or the reasons for denial if the relief sought in the protest was denied;

(3)           the date the determination was mailed or sent to the employer by electronic transmission;

(4)           the employer's right to appeal the determination consistent with 04 NCAC 24C .0203;

(5)           the time period within which an appeal shall be filed; and

(6)           instructions for filing an appeal with DES's Appeals Section pursuant to 04 NCAC 24A .0104(b).

 

History Note:        Authority G.S. 96-4; 96-11.3; 96-15;

Eff. July 1, 2015;

Recodified from 04 NCAC 24D .0107 Eff. March 1, 2017;

Amended Eff. October 1, 2017.

 

SECTION .0300 - ADEQUACY

 

04 NCAC 24D .0301          ADEQUACY THRESHOLD

(a)  An employer who establishes a pattern of failing to provide a timely response or adequate response to the Request for Separation Information (Form NCUI 500AB) under 04 NCAC 24B .0107, shall not be relieved of charges for resulting erroneous unemployment insurance benefit payments.

(b)  In determining the timeliness of an employer response, DES shall consider the following:

(1)           whether the response was received within 14 days pursuant to G.S. 96-15; and

(2)           whether the employer had good cause for failing to respond within the 14 day period.

(c)  In determining the adequacy of an employer response, DES shall consider the following:

(1)           what information was requested;

(2)           whether the response to the request is sufficient to satisfy the request;

(3)           whether an employer should have provided DES with copies of relevant handbooks, policies, warnings, recordings, documents, or other information related to the claim; and

(4)           whether the employer's responses provide enough facts to enable an authorized DES representative to make a correct legal determination without having to contact the employer to obtain additional information.

(d)  An employer who fails to submit timely or adequate responses to two or two-percent, whichever is greater, of the total requests for separation information (Form NCUI 500AB) under G.S. 96-11.4 during the reporting cycle, shall not be relieved of erroneous payments in the following charging cycle as defined under 04 NCAC 24A .0105.

(e)  DES shall review each employer's account every reporting cycle to determine whether the employer has a pattern of failing to respond timely or adequately to requests for separation information under G.S. 96-11.4, and shall issue an Adequacy Threshold Determination at the conclusion of the reporting year cycle if the employer has met the criteria defined under Paragraph (d) of this Rule.

 

History Note:        Authority G.S. 96-4; 96-11.3; 96-11.4; 96-15; 23 U.S.C. 3303;

Eff. July 1, 2015.

 

04 NCAC 24D .0302          ADEQUACY THRESHOLD DETERMINATION

(a)  The Adequacy Threshold Determination shall include:

(1)           the effect of the determination on the employer's account;

(2)           the reasons for the determination;

(3)           the date the determination was mailed or sent by electronic transmission to the employer;

(4)           instructions for protesting the determination; and

(5)           the time period within which a protest shall be filed.

(b)  An employer may protest its Adequacy Threshold Determination and shall file its written request with DES's Claims Unit pursuant to 04 NCAC 24A .0104(m).

(1)           The request shall include the following:

(A)          the name of the employing unit;

(B)          the address of the employing unit;

(C)          the account number of the employing unit;

(D)          a statement of the question involved and reasons for the request; and

(E)           the name, address, and official position of the individual making the request.

(2)           The written request shall be filed within 15 days after the date that the Adequacy Threshold Determination notice was sent to the employer, and the timeliness requirements of 04 NCAC 24A .0106 shall apply.

(c)  Following receipt of the written request, the Claims Unit shall review the employer's request for review and issue a written determination. The determination shall notify the employing unit of whether its application was granted or denied, and explain the reasons for the ruling and what information was considered.

(d)  No further right of appeal from an unfavorable written determination of a protest of an Adequacy Threshold Determination shall exist unless and until an Adequacy Penalty Determination, as defined under Rule .0303 of this Section is issued at the conclusion of each corresponding charging cycle.

 

History Note:        Authority G.S. 96-4; 96-11.3; 96-11.4; 96-15; 26 U.S.C. 3303;

Eff. July 1, 2015;

Amended Eff. October 1, 2017.

 

04 NCAC 24D .0303          ADEQUACY PENALTY DETERMINATION

(a)  DES shall issue a written Adequacy Penalty Determination at the end of each charging cycle to notify the employer of charges to its account for erroneous unemployment benefit payments identified during the charging cycle if the payments resulted from untimely or inadequate responses as set forth in 04 NCAC 24D .0301 to requests for information regarding a claimant's separation from employment or status, if the employer met or exceeded the adequacy threshold in the prior reporting cycle.

(b)  The Adequacy Penalty Determination shall include the following:

(1)           a listing containing the specific claims that would have resulted in a relief from charges as a result of erroneous unemployment insurance payments that were later reversed on appeal;

(2)           instructions for protesting the Adequacy Penalty Determination; and

(3)           the date that the Adequacy Penalty Determination is mailed or sent to the employer by electronic transmission.

(c)  An employer may protest its Adequacy Penalty Determination and shall file its written request with DES's Claims Unit pursuant to 04 NCAC 24A .0104(m).

(1)           The request shall include:

(A)          the name of the employing unit;

(B)          the address of the employing unit;

(C)          the account number of the employing unit;

(D)          a statement of the question involved and reasons for the request; and

(E)           the name, address, and official position of the individual making the request.

(2)           The written request shall be filed within 15 days after the date that the Adequacy Penalty Determination was mailed or provided to the employer by electronic transmission, and the timeliness requirements of 04 NCAC 24A .0106 shall apply.

(3)           Following receipt of the written request, the Claims Unit shall review the employer's request and issue a written determination. The determination shall notify the employing unit of whether its application was granted or denied, explain the reasons for the ruling and identify the information considered, and contain instructions for appealing a denial to DES's Appeals Section pursuant to 04 NCAC 24A .0104(m).

 

History Note:        Authority G.S. 96-11.3; 96-11.4; 96-15; 26 U.S.C. 3303;

Eff. July 1, 2015;

Amended Eff. October 1, 2017.

 

04 NCAC 24D .0304          APPEALING ADEQUACY PENALTY DETERMINATIONS

(a)  An employer may file an appeal of its Adequacy Penalty Determination and request a hearing. The appeal shall be filed with DES's Claims Unit pursuant to 04 NCAC 24A .0104(m).

(b)  The appeal shall be filed within 15 days after the date that the Adequacy Penalty Protest Determination was sent to the employer, and the timeliness requirements of 04 NCAC 24A .0106 shall apply.

(c)  Appeal hearings from Adequacy Penalty Determinations shall be conducted as set forth in Section .0200 of Subchapter 24C.

 

History Note:        Authority G.S. 96-11.3; 96-11.4; 96-15; 26 U.S.C. 3303;

Eff. July 1, 2015;

Amended Eff. October 1, 2017.

 

Section .0400 - Voluntary Election and Payments

 

04 NCAC 24D .0401          Voluntary Election by Employers

(a)  Any employer electing coverage under G.S. 96-9.8 of the Employment Security Law shall make the election by completing the Employer Status Report (Form NCUI 604), available on DES's website at www.ncesc.com.

(b)  The information provided in the Employer Status Report (Form NCUI 604) shall be provided in the same manner as required under Rule .0602 of this Subchapter.

(c)  Voluntary election shall not be granted if DES determines that potential benefit payments would exceed the taxes received from the employer.

(d)  The effective date of coverage is January 1, or the first day of employment in the year in which the voluntary election is made, whichever is later.

(e)  Employers who satisfy the criteria for voluntary election of coverage under this Rule, shall have a contributory unemployment tax account, and shall not have a reimbursable account.

 

History Note:        Authority G.S. 96-4; 96-9.6; 96-9.8; 26 U.S.C. 3309;

Eff. July 1, 2015.

 

04 NCAC 24D .0402          Election TO REIMBURSE IN LIEU OF CONTRIBUTIONS

(a)  An employer electing to pay reimbursements for benefits, rather than contributions who meets the requirements of Rule .0401 of this Section, shall make the election by completing the Employer Status Report (Form NCUI 604) as set forth in Rule .0602 of this Subchapter, and mailing it to DES's Tax Administration at Post Office Box 26504, Raleigh, NC 27611.

(b)  A qualifying employer under G.S. 96-9.6 electing to pay reimbursements for benefits, rather than contributions, shall make the election by writing a letter stating their election to the Tax Administration Section of DES at Post Office Box 26504, Raleigh, NC 27611 within 30 days after the employer receives written notification from the Division that it is eligible to make an election as defined under G.S. 96-9.6.

 

History Note:        Authority G.S. 96-4; 96-9.6; 96-9.8; 26 U.S.C. 3309;

Eff. July 1, 2015.

 

04 NCAC 24D .0403          Payment of Employer Taxes

(a)  Taxes shall be due and payable to the DES's administrative office in Raleigh, North Carolina, or to an agent of DES designated to accept payments.

(b)  Tax payments shall be made as follows:

(1)           electronic check;

(2)           credit card;

(3)           Automated Clearing House (ACH) credit;

(4)           business check with funds drawn from a U.S. financial institution;

(5)           cashier's check from a U.S. financial institution; or

(6)           cash.

(c)  Payments shall be made payable to the Division of Employment Security and sent by U.S. mail or delivery service to DES Tax Administration at Post Office Box 26504, Raleigh North Carolina 27611.

(d)  Timeliness of payments shall be determined pursuant to the 04 NCAC 24A .0106.

 

History Note:        Authority G.S. 96-4; 96-9.15;

Eff. July 1, 2015.

 

Section .0500 - Records

 

04 NCAC 24D .0501          Records of EmployERs

(a)  Each employer shall keep accurate employment and payroll records. These records shall be maintained for five years after the calendar year in which wages for services are paid and shall include the following:

(1)           the name and correct address of the employer;

(2)           the name and address of each division, branch, or establishment operated, owned, or maintained by the employer at different locations in North Carolina; and

(3)           the following information for each individual performing services for the employer:

(A)          the individual's name;

(B)          the individual's address;

(C)          the individual's social security number;

(i)            if an individual performing services for an employer does not have a social security number, the employer shall request that the individual produce a receipt issued by the Social Security Administration, showing that the individual has filed an application for a social security number;

(ii)           the employer shall copy and retain a copy of the receipt, and the individual must retain the receipt;

(D)          the dates on which the individual performed services for the employer;

(E)           the actual number of hours worked each day and total number of hours worked each week;

(F)           daily attendance record, including times that the individual did not work for reasons other than lack of work;

(G)          the state or states in which the individual performed services;

(i)            the base of operations if any of the services are performed outside North Carolina, and are not incidental to the services performed in North Carolina; or

(ii)           if there is no base of operations, then the place from which services are directed or controlled; and

(iii)          the individual's state of residence;

(H)          the amount of wages paid to the individual for each separate payroll period, if paid weekly, or if not paid weekly, by calendar weeks;

(i)            date of payment of the wages; and

(ii)           amounts or remuneration paid to each individual for each separate payroll period other than "wages," as defined in G.S. 96-1(b)(28);

(I)            amounts paid to individuals as allowances or reimbursements for travel or other business expenses, dates of payments, and the amounts of expenditures actually incurred and documented by the individual;

(J)            whether, during any payroll period the individual worked less than full time, and if so, the hours and dates worked;

(K)          reasons for an individual's separation from work;

(L)           any contract between the employer and the worker;

(M)         where the employer considers the worker to be an independent contractor or otherwise not an "employee" under the Employment Security Law, all records, documentation and evidence which supports that classification; and

(N)          federal and state tax returns for the periods when the worker was employed.

(b)  In addition to the records required in Paragraph (a) of this Rule, each employer shall keep the following:

(1)           the records that establish and reflect ownership and any changes of ownership of the employer;

(2)           the address where the headquarters of the employer is located; 

(3)           the mailing address of the employer; and

(4)           the address at which the records are available for inspection or audit by representatives of DES.

(c)  Each employer's records shall reflect:

(1)           the addresses of owners; or

(2)           in the event the employer is a corporation or an unincorporated organization, the records shall show the addresses of directors, officers, and any individuals on whom subpoenas, legal processes, or citations may be served in North Carolina.

 

History Note:        Authority G.S. 96-4; 96-9.15; 96-10; 26 U.S.C. 3306;

Eff. July 1, 2015.

 

04 NCAC 24D .0502          Wage Records

(a)  Wages paid for services excluded from the definition of "employment" as defined in G.S. 96-1(b)(12) shall be separately reflected in the employer's records to indicate the following:

(1)           the time of service; and

(2)           remuneration for services that is separate from taxable wages.

(b)  Where there are pay periods in which an individual performs services excluded from the term "employment," and any service which is "employment," the employer's record shall reflect the hours spent in the excluded service and the hours spent in "employment."

(c)  If any remuneration other than monetary wages is paid to or is received by an individual related to services performed by the individual, the records shall show the total amount of cash wages and the cash value of any other remuneration paid by the employer.

(d)  If any part of an individual's wages is not paid in cash, the reasonable cash value of the remuneration other than cash shall be deemed for all relevant purposes as follows:

(1)           the amount that is agreed upon between the employer and the individual if:

(A)          the terms of the agreement are reported to DES; and

(B)          DES determines that the agreed value or amount is reasonable pursuant to IRS Publication 15-B; or

(2)           the amount DES determines if:

(A)          the amount agreed upon is unreasonable; or

(B)          the employer and the individual fail to agree upon an amount; or

(C)          the employer fails to report the terms of an agreement to DES; and

(D)          the employer fails to show the cash value of the noncash remuneration prior to the due date of contributions with respect to the wages.

(3)           DES shall determine an amount by reviewing documents, tax values, internet sites and other available information that reflects the market value.

(e)  This Rule incorporates material found in the IRS Publication 15-B by reference and includes subsequent amendments and editions of the referenced material in accordance with G.S. 150B-21.6.  Copies of the incorporated material found in IRS Publication 15-B are located at 700 Wade Avenue, in Raleigh, North Carolina and may be obtained at no cost to the public by request by contacting DES as specified under 04 NCAC 24A .0201.

 

History Note:        Authority G.S. 96-1(b)(28); 96-4; 26 U.S.C. 3306; IRS Pub. 15-B;

Eff. July 1, 2015.

 

04 NCAC 24D .0503          Allowances and Reimbursement Advances

(a)  Allowances, advances of reimbursements paid to an individual in employment for traveling, and other bona fide expenses incurred or reasonably expected to be incurred in the business of the individual's employer shall not be treated as wages, provided:

(1)           a separate payment is made for the expenses; or

(2)           itemized accounting records are kept indicating the separate amounts where a single payment covers both wages and expenses combined; and

(3)           the amount of payments for expenses excluded from wages shall not exceed the amounts allowable as deductible expenses by income tax regulations under the United States Internal Revenue Code, 26 U.S.C. 62(2) and 26 U.S.C. 162(a)(2).  Where the United States Internal Revenue Service (IRS) has not made a determination, DES shall make an independent determination.

(b)  Where an employee must pay traveling and other expenses out of commissions or salary and these amounts are not accounted for separately, the entire amount of commissions or salary shall be considered wages, unless the employer submits itemized records which show that a certain percentage of commissions or salary is expenses. 

(1)           The money value for room and board shall not be included in wages if the room and board is provided to the employee for the convenience of the employer. 

(A)          If the room and board has been excluded from wages by the IRS for income tax withholdings, FICA and FUTA, it shall be considered to be for the convenience of the employer and excluded from wages.

(c)  This rule incorporates 26 U.S.C. 62(2) "Adjusted Gross Income Defined" and 26 U.S.C. 162(a)(2) "Traveling Expenses" by reference and includes subsequent amendments and editions of the referenced material in accordance with G.S. 150B-21.6.  Copies of the incorporated material found in 26 U.S.C. 62(2) and 26 U.S.C. 162(a)(2) are located at 700 Wade Avenue, in Raleigh, North Carolina, and may be obtained by request at no cost to the public by contacting DES as specified under  04 NCAC 24A .0201.

 

History Note:        Authority G.S. 96-4; 150B-21.6; 26 U.S.C. 62(2); U.S.C. 162(a)(2).

Eff. July 1, 2015.

 

04 NCAC 24D .0504          Manner of Recordkeeping

(a)  Each employer shall maintain records as prescribed in this Section.

(b)  All records shall be kept and maintained in a manner that preserves the integrity of all reports that the employing unit is required to file with DES.

(1)           Records shall be accessible to authorized representatives of DES within the geographical boundaries of the State of North Carolina.

(2)           When records are not maintained, or are not available within North Carolina, the employing unit shall pay to DES the expenses and costs incurred when a representative of DES is required to travel outside the State of North Carolina to inspect or audit the employing unit's records or provide for delivery of the required records for inspection or audit to DES via mail or electronic transmission.

(3)           Where records are delivered via electronic transmission, the employer shall provide DES with all necessary information to access the content of the electronic transmission.

(c)  Where any part of an employing unit’s accounting records are maintained by an automated data processing system, the employing unit shall provide the following:

(1)           audit trails with all supporting documentation;

(2)           general accounting books with any ledgers containing source references that coincide with financial reports for reporting periods; and

(3)           a description of the automatic data processing portion of the employing unit's accounting system. 

(d)  Each employing unit, when requested by DES, shall furnish a job description of duties performed by any individual or group of individuals who are performing or have performed services for the employing unit.

(e)  Records prescribed by this Subchapter shall be preserved for five years after the calendar year in which wages for services are paid.

 

History Note:        Authority G.S. 96-4; 96-10; 26 U.S.C. 3306;

Eff. July 1, 2015.

 

Section .0600 - Reports

 

04 NCAC 24D .0601          GENERAL FORMAT OF REPORTS AND FORMS AND METHODS OF SUBMISSION

(a)  The following shall file the portion of the required Employer's Quarterly Tax and Wage Report (NCUI 101) that contains the name, social security number, and gross wages of each employee on magnetic or electronic media using a compact disk, online remote tax filing, or upload of data file via the internet format:

(1)           employers with 25 or more employees in any one calendar quarter; and

(2)           other entities, including agents reporting on behalf of employers, who file reports for a client employer with a total of 25 or more employees in any one calendar quarter.

(b)  Quarterly Employer's Tax and Wage Reports (Form NCUI 101) shall contain the individual employees' wages section and wage summary section. 

(c)  Employers, including agents, who file an Employer's Quarterly Tax and Wage Report for a client employer with less than 25 total employees in any one calendar quarter may use magnetic or electronic media reporting.  Employers with less than 25 employees may also file paper returns.

(d)  A magnetic or electronic media wage report from agents reporting on behalf of employers may contain information from multiple employers.

 

History Note:        Authority G.S. 96-4; 96-9.15;

Eff. July 1, 2015.

 

04 NCAC 24D .0602          STATUS REPORTS 

(a)  Each employing unit shall file an Employer Status Report (Form NCUI 604) with DES within 10 days of becoming subject to the Employment Security Law.  The Employer Status Report shall contain the following:

(1)           the name and address of the business;

(2)           names, social security numbers, and addresses of the owners and responsible officers of the business;

(3)           any records pertaining to contracts for business acquisitions that indicate successorship status; and

(4)           any information about company officers in continuity of control cases.

(b)  An employing unit that ceases business, transfers, leases, or sells all or any part of the assets of its business, or changes the trade name or address of the business shall give notice to DES within 10 days by filing a status report.  The status report shall contain, in addition to the requirements listed under Paragraph (a) of this Rule, the former name and address of the business.

 

History Note:        Authority G.S. 96-4; 96-10; 96-11.7;

Eff. July 1, 2015.

 

04 NCAC 24D .0603          QUARTERLY REPORTS FROM TAXED EMPLOYERS

(a)  Each employer, other than a domestic employer who has elected to report and pay annually under G.S. 96-9.15(f), shall file with DES, within the month during which contributions for any period become due, an Employer's Quarterly Tax and Wage Report (Form NCUI 101) for the preceding calendar quarter that shall indicate the following:

(1)           the total amount of remuneration paid for employment, or proof that no remuneration was paid during the quarter;

(2)           the total amount of wages paid for employment;

(3)           the amount of wages paid to each individual employee; and

(4)           the name and social security number of each individual to whom the wages were paid and the federal identification number, if one exists.

 

History Note:        Authority G.S. 96-4; 96-9.6; 96-9.15; 96-10;

Eff. July 1, 2015.

 

04 NCAC 24D .0604          ANNUAL REPORTS FROM DOMESTIC EMPLOYERS

(a)  A request by a domestic employer to report wages paid, and pay contributions on an annual basis shall be made in writing and delivered to DES pursuant to 04 NCAC 24A .0104.  There is no special form or format required for the written request.

(b)  Each qualified domestic employer who has made an election as referenced in Paragraph (a) of this Rule shall file with DES, a domestic Employer's Annual Tax and Wage Report (Form NCUI 101-C), that shall include all information specified under Rule .0603 of this Section and subtotaled for each quarter during the calendar year in which wages were paid.

 

History Note:        Authority G.S. 96-4; 96-9.15; 96-10;

Eff. July 1, 2015.

 

Section .0700 - TRANSFER OF EXPERIENCE RATING TO RELATED ENTITY SUCCESSOR ACCOUNT

 

04 NCAC 24D .0701          TRANSFER OF EXPERIENCE

(a)  A new successor employer that acquires a part of an entity related to the transferring employer shall request a percentage of the transferring employer's experience rating when:

(1)           the successor employer is a distinct and severable portion of the transferring employer;

(2)           it is severed from the control of the transferring employer;

(3)           a severable and distinct portion of the successor employer would not be a disregarded entity or subsidiary of the transferring employer but an entity that is operational on its own with no support from the transferring employer;

(4)           the successor employer is comprised of shareholders or owners, or employees from the transferring employer; and

(5)           the successor employer's operations may remain similar to those of the transferring employer including proprietorships that split between family members as defined in G.S. 96-1(b)(18), spin-off corporations, partnerships that split operations between partners, or any other division in operations, that would not result in denial of a new discrete employer number to the successor employer pursuant to G.S. 96-11.7(c). 

(b)  A transferring employer shall be left operational on its own with no support from the successor employer.

(c)  A successor employer shall request a transfer of experience under conditions described in Rule .0702 of this Section and a transferring employer shall request to retain the remaining experience pursuant to Rule .0702 of this Section. 

(d)  The percentage of the experience that is transferred to the successor employer shall be transferred as of the date of acquisition for use in determining the successor's contribution rate.

 

History Note:        Authority G.S. 96-4; 96-10; 96-11.7;

Eff. July 1, 2015.

 

04 NCAC 24D .0702          REQUIREMENTS FOR TRANSFER OF EXPERIENCE

(a)  A successor employer shall submit the following information to DES when requesting a partial transfer of experience rating:

(1)           the total three-year taxable payroll ending June 30th prior to the last computation date for the  transferring employer; and

(2)           the total three-year taxable payroll ending June 30th prior to the last computation date for the transferring employer, relating to the severable portion acquired.

(b)  Not withstanding Paragraph (a) of this Rule, an alternate three-year payroll may be used when the severed or retained unit was not operated by the transferring employer during the three-year period ending June 30th prior to the last computation date.

(c)  A successor employer that acquires the experience rating account, either total or partial, shall be liable for accrued benefits and acquire related rights based on the transferring employer's employment prior to the acquisition.  Benefit charges to the transferring or successor employer shall be made in accordance with the percentage used to transfer the experience rating account, based on wages paid prior to the transfer.

(d)  The requirements of this Section shall apply to transfers mandated by law, and those requiring DES's approval pursuant to G.S. 96-11.7.

(e)  The completion and submission of Form NCUI 603 with the information described in Paragraph (a) of this Rule, and in accordance with Rule 04 NCAC 24A .0104(o) shall satisfy the requirements of this Rule.

 

History Note:        Authority G.S. 96-4; 96-10; 96-11.7;

Eff. July 1, 2015.

 

SECTION .0800 - AGREEMENTS TO COMPROMISE

 

04 NCAC 24D .0801          APPLICATION

(a)  An employing unit may file a request for compromise of its tax debt with DES.

(b)  A request for compromise shall include the following:

(1)           the name and address of the employing unit;

(2)           the date the request to compromise is made;

(3)           the date the requested compromise is requested to be effective;

(4)           stated reasons for the request to compromise;

(5)           evidence to support the claim or reasons for the request;

(6)           the amount and terms offered by the employer to settle the debt; and

(7)           the signature of a duly authorized representative of the employer.

(c)  The employer shall provide all information requested by the Department pursuant to Section .0500 of this Section for the determination of the compromise.

(d)  The request for compromise shall be filed with DES's Tax Administration Section by mail, facsimile, or email. pursuant to 04 NCAC 24A .0104(n).

 

History Note:        Authority G.S. 96-4; 96-10; 96-10.1;

Eff. July 1, 2015.

 

SECTION .0900 - SPECIAL TAX INVESTIGATIONS

 

04 NCAC 24D .0901          SPECIAL TAX INVESTIGATIONS

(a)  When it is discovered by a representative of DES that a claimant is alleging that he or she was an employee and the employer is alleging that the claimant was not an employee, the matter shall be referred to DES's Assistant Secretary in writing. 

(b)  The Assistant Secretary, on behalf of DES, shall issue a Result of Investigation by the Tax Administration Section upon receipt of the findings of the investigation.  The Result of Investigation shall be in writing and mailed to each party to the controversy pursuant to 04 NCAC 24A .0103.

(c)  The Result of Investigation shall provide notice of each party's rights for filing an appeal to obtain a hearing before the Board of Review, and the time period within which an appeal shall be filed by mail to the Board of Review, ATTN: Legal Services Section, Post Office Box 25903, Raleigh, 27611-5903.

(d)  Appeal hearings pursuant to this Section shall be upon order of the Board of Review and conducted pursuant to 04 NCAC 24F .0303.

 

History Note:        Authority G.S. 96-4; 96-9.2;

Eff. July 1, 2015.

 

SECTION .1000 - REQUESTS AND HEARINGS TO REVIEW AND REDETERMINE TAX RATE

 

04 NCAC 24D .1001          REQUEST FOR REDETERMINATION OF TAX RATE

(a)  An employer may request a review and redetermination of its tax rate after receiving notice of the tax rate. 

(b)  An employer requesting a review and redetermination of its tax rate shall file its written request with DES's Tax Administration Section by mail to Post Office Box 26504, Raleigh, NC 27611, facsimile to (919) 733-1255, or email to des.tax.customerservice@nccommerce.com.

(1)           The request shall include the following:

(A)          the name of the employer;

(B)          the address of the employer;

(C)          the account number of the employer;

(D)          a brief statement of the question involved and reasons for the request; and

(E)           the name, address, and official position of the individual making the request.

(c) The request for a review and redetermination shall be filed on or before prior to May 1 following the effective date of the contribution rate pursuant to G.S. 96-9.2(d). 

 

History Note:        Authority G.S. 96-4; 96-9.2;

Eff. July 1, 2015.

 

04 NCAC 24D .1002          DIVISION’S OBLIGATIONS

(a)  The Division shall review the employing unit's request to review and redetermine its tax rate and all available facts, and shall issue a written ruling. The ruling shall be mailed to the employing unit's address as set forth in 04 NCAC 24A .0103 and include the following:

(1)           notify the employing unit of whether its application was granted or denied;

(2)           the applicable legal authority, with specific citations, for the ruling;

(3)           contain the mailing date of the notice;

(4)           a statement containing the employer's right to appeal the notice; and

(5)           the time period within which an appeal shall be filed.

(b)  The employing unit may file an appeal of the ruling and request a hearing.

(1)           The appeal shall be filed with DES's Tax Administration Section by mail, facsimile, or email pursuant to Rule 04 NCAC 24A .0104(o).

(2)           Hearings requested pursuant to this Section shall be conducted as set forth in 04 NCAC 24F .0303.

 

History Note:        Authority G.S. 96-4; 96-9.2;

Eff. July 1, 2015.

 

04 NCAC 24D .1003          CONTINUED PAYMENTS REQUIRED

The employer shall continue to pay contributions at the rate assigned pending any hearing on an application for review and redetermination of tax rate until finally adjudicated.  If the rate assigned is subsequently changed by a ruling of the Board of Review or the courts, the employer shall be entitled to a refund, or be liable for additional contributions.

 

History Note:        Authority G.S. 96-4; 96-9.2; 96-10;

Eff. July 1, 2015.

 

SECTION .1100 - TAX LIABILITY HEARINGS

 

Codifier's Note: Rules codified as 04 NCAC 24D .1101-.1104 were transferred to 04 NCAC 24F .0301-.0304. Rules codified in 04 NCAC 24D .1105-.1107 were transferred to 04 NCAC 24F .0306-.0308 effective October 1, 2017.

 

SECTION .1200 - SEASONAL PURSUITS

 

04 NCAC 24D .1201          REQUEST FOR SEASONAL DETERMINATION 

(a)  Each employer desiring a seasonal determination shall request assignment of the seasonal period by DES.

(b)  The request shall be made in writing by completing the Application for Seasonal Determination (Form NCUI 611) that is available on DES's website at www.ncesc.com and addressed to the Tax Administration Section by mail, facsimile, or email as provided in 04 NCAC 24A .0104.

(c)  Requests for Seasonal Determination using (Form NCUI 611) shall contain the following:

(1)           the employing unit's name and physical address;

(2)           years of operation in North Carolina;

(3)           location of  each seasonal pursuit;

(4)           description of seasonal each pursuit; and

(5)           beginning and ending dates of each seasonal pursuit for the last four years.

(d)   The request shall be filed at least 20 days before the beginning date of the period of production operations for which the designation is requested.

(e)  Completion and Submission of Form NCUI 611 shall satisfy the requirements of this Rule.

 

History Note:        Authority G.S. 96-4; 96-16;

Eff. July 1, 2015.

 

04 NCAC 24D .1202          WRITTEN DETERMINATION 

(a)  DES shall issue a written determination granting or denying the request upon making its determination pursuant to G.S. 96-16(c).  The determination shall notify the employer of the following:

(1)           the specific seasonal period assigned by DES;

(2)           the effective date of the determination; and

(3)           the specific filing requirements for seasonal employers.

(b)  Any determination that denies the request for a seasonal designation shall state the reasons for the denial.

(c)  Each determination shall contain notice of each party's right to appeal the determination and request a hearing, the date the determination was mailed, and the time period within which an appeal shall be filed.

(d)  The employer may file its appeal of a denial of a request for seasonal pursuit designation with DES's Tax Administration Section in the same manner as prescribed under Rule .1201 of this Section, by submitting a Form NCUI 611 by mail to Post Office Box 26504, Raleigh, NC 27611, facsimile to (919) 733-1255, or email to des.tax.customerservice@nccommerce.com

(e)  Hearings shall be conducted as set forth in Rule .1103 of this Subchapter.

 

History Note:        Authority G.S. 96-4; 96-16;

Eff. July 1, 2015.

 

04 NCAC 24D .1203          DISPLAY REQUIRED 

(a)  Each employer shall display no less than two Notice to Workers of a Seasonal Determination forms in separate locations (Form NCUI 543) on its premises.  Form NCUI 543 shall be sent to employers when approved for Seasonal Pursuit status by mail and shall contain:

(1)           notice that a seasonal determination was requested by the employer and issued by DES; and

(2)           instructions for workers employed by the employer to protest the determination within 10 days.

(b)  The Notice to Workers of a Seasonal Determination (Form NCUI 543) shall be provided by DES and shall be displayed on the employer's premises in such places as:

(1)           entry ways used by workers to enter and exit the employer's premises;

(2)           in or near an area where a record of time worked is required to be used or frequented by workers;

(3)           a bulletin board in places where workers gather; or

(4)           other locations within the place of employment visible to employees.

 

History Note:        Authority G.S. 96-4; 96-16;

Eff. July 1, 2015.

 

04 NCAC 24D .1204          WAGE RECORDS AND REPORTS REQUIREMENT 

(a)  Any pursuit that DES determines to be seasonal shall maintain payroll records such that the seasonal wages paid to workers during the active periods of the seasonal pursuit may be distinguished from any non-seasonal wages that are paid to those workers.

(b)  Any employer engaged in a seasonal pursuit shall submit quarterly wage reports pursuant to Rule .0603 of this Subchapter, showing the seasonal wages paid to workers during the active periods assigned by DES.

(c)  Within 15 days of the date that DES mails notice of a seasonal period, the employer shall complete and submit to DES a Breakdown of Wages Previously Reported for Workers to Show Seasonal and Non-Seasonal Wages (Form NCUI 542) with seasonal wages in the current base period and in intervening quarters between the base period and completed calendar quarters preceding the first day of the active period, which shall include the following:

(1)           each worker's social security number, and name; and

(2)           each worker's seasonal wages, non-seasonal wages and total wages for each calendar quarter.

(d)  Any wages earned by seasonal workers outside the seasonal period assigned by DES shall be reported as non-seasonal wages, even though they may have been earned for seasonal work.

 

History Note:        Authority G.S. 96-4; 96-16;

Eff. July 1, 2015.

 

SECTION .01300 – COLLECTION METHODS OF EMPLOYER DEBT

 

04 NCAC 24D .1301          NOTICE to employer

(a)  DES shall serve notice and execution of levy on employer to collect past due unemployment insurance taxes, penalties, interest, and costs.

(b)  Notice shall be written and provided to the employer by U.S. mail.

(c)  The notice shall state the following:

(1)           that DES is in possession of judgments and executions that were properly docketed and indexed by the clerks of the superior court;

(2)           the county of the superior court where the judgments and executions are docketed;

(3)           that DES mailed previous notice of the debt and the date DES mailed notice to the employer;

(4)           the amount owed by the employer;

(5)           the name of any other individual or entity that will receive notice of the debt;

(6)           the statutory authority for service of execution of levy by DES;

(7)           the relief sought by DES; and

(8)           the name, address and telephone number of an authorized representative of DES who may be contacted regarding the debt.

 

History Note:        Authority G.S. 1-359; 96-4; 96-10; 96-18;

Eff. July 1, 2015.

 

04 NCAC 24D .1302          NOTICE to GARNISHEE

(a)  DES shall serve notice and execution of levy on third parties in order to collect past due unemployment insurance taxes, penalties, interest, and costs.

(b)  Notice shall be written and provided to the garnishee by U.S. mail.

(c)  The notice shall state the following:

(1)           the name of the indebted employer;

(2)           that DES is in possession of judgments and executions that were properly docketed and indexed by the clerks of the superior court;

(3)           the county of the superior court where the judgments and executions are docketed;

(4)           that the employer has received previous notice of the debt;

(5)           the amount owed by the employer;

(6)           statutory authority for service of execution of levy;

(7)           relief sought and how to remit payment; and

(8)           the name, address and telephone number of an authorized representative of DES who may be contacted regarding the debt.

 

History Note:        Authority G.S. 1-359; 96-4; 96-10;

Eff. July 1, 2015.

 

SECTION .1400 - RECORDS

 

04 NCAC 24D .1401          OFFICIAL FORMS 

(a)  Unless otherwise provided, all employer forms referenced under the rules of this Chapter are available by contacting the Employer Call Center (ECC) as follows:

(1)           mailing address is Post Office Box 26504, Raleigh, North Carolina 27611;

(2)           phone number is (919) 707-1150;

(3)           facsimile number is (919) 715-0780; or

(4)           email address is des.tax.customerservice@nccomerce.com.

(b)  Unless otherwise provided, all claimant forms referenced under the rules of this Chapter are available by contacting the Customer Call Center (CCC) as follows:

(1)           mailing address is P.O. Box 25903, Raleigh, NC 27611-5903;

(2)           phone number is (888) 737-0259;

(3)           facsimile number is (919) 250-4315; or

(4)           email address is des.ui.customerservice@nccommerce.com.

 

History Note:        Authority G.S. 96-4; 96-16;

Eff. July 1, 2015.