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Article #6: Payroll Vermont, Unique Aspects of Vermont Payroll Law and Practice

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The Vermont State Agency that oversees 20 days of the hiring or rehiring. The
the collection and reporting of State information can be sent as a W4 or
income taxes deducted from payroll checks equivalent by mail, fax or
is: electronically. There is a $500 penalty
Department of Taxes 109 State Street for conspiracy in Vermont.
Montpelier, VT 05609-1401 (802) 828-2551 The Vermont new hire-reporting agency can
be reached at 800-786-3214 or
Vermont allows you to use the "W-4VT, 802-241-2194 or on the web at
Vermont Employee Withholding Allowance Vermont does not allow compulsory direct
Certificate" form to calculate state deposit
income tax withholding or federal W4 Vermont requires the following
form. information on an employee's pay stub:
Not all states allow salary reductions - Gross and Net Earnings
made under Section 125 cafeteria plans or - straight time and overtime pay
401(k) to be treated in the same manner - hours worked
as the IRS code allows. In Vermont - itemized deductions
cafeteria plans are not taxable for Vermont requires that employee be paid no
income tax calculation; taxable for less often than weekly; biweekly or
unemployment insurance purposes. 401(k) semimonthly if employer gives notice.
plan deferrals are not taxable for income Vermont requires that the lag time
taxes; taxable for unemployment purposes. between the end of the pay period and the
In Vermont supplemental wages are taxed payment of wages to the employee not
at a 7.2% flat rate. exceed six days; 13 under union contract.
Magnetic media reporting of W-2s is not Vermont payroll law requires that
allowed in Vermont. involuntarily terminated employees must
The Vermont State Unemployment Insurance be paid their final pay with in 3 working
Agency is: days and that voluntarily terminated
Department of Employment and Training 5 employees must be paid their final pay by
Green Mountain Dr. P.O. Box 488 the next regular payday; if there is
Montpelier, VT 05601-0488 (802) 828-4344 none, next Friday.
(877) 214-3331 There is no provision in Vermont law
The State of Vermont taxable wage base concerning paying deceased employees.
for unemployment purposes is wages up to Escheat laws in Vermont require that
$8000.00. unclaimed wages be paid over to the state
Vermont has optional reporting of after two years.
quarterly wages on magnetic media. There is no provision in Vermont law
Unemployment records must be retained in concerning record retention of abandoned
Vermont for a minimum period of six wage records.
years. This information generally Vermont payroll law mandates no more than
includes: name; social security number; $3.35 may be used as a tip credit.
dates of hire, rehire and termination; In Vermont the payroll laws covering
wages by period; payroll pay periods and mandatory rest or meal breaks are only
pay dates; date and circumstances of that all employees be given a reasonable
termination. opportunity to eat and use toilet
The Vermont State Agency charged with facilities.
enforcing the state wage and hour laws There is no provision in Vermont law
is: concerning record retention of wage and
Department of Labor and Industry Wage hour records therefor it is probably wise
and Hour Division National Life Bldg., to follow FLSA guidelines.
Drawer 20 Montpelier, VT 05620-3401 The Vermont agency charged with enforcing
(802) 828-2157 Child Support Orders and laws is:
The minimum wage in Vermont is $7.00 per Office of Child Support Agency of Human
hour. Services 103 S. Main St. Waterbury, VT
The general provision in Vermont 05671-1901 (800) 786-3214
concerning paying overtime in a non-FLSA Vermont has the following provisions for
covered employer is one and one half child support deductions:
times regular rate after 40-hour week. - When to start Withholding? 10 days
Vermont State new hire reporting after receipt of order or next payday.
requirements are that every employer must - When to send Payment? Within 7 days
report every new hire and rehire. The of Payday.
employer must report the federally - When to send Termination Notice?
required elements of: Within 10 days of termination.
- Employee's name - Maximum Administrative Fee? $5 per
- Employee's address month.
- Employee's social security number - Withholding Limits? Federal Rules
- Employer's name under CCPA.
- Employers address Please note that this article is not
- Employer's Federal Employer updated for changes that can and will
Identification Number (EIN) happen from time to time.
This information must be reported within






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