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FILE COMBINED RETURNS ON THE INTERNET!

Most Maine employers may file their

The following types of employers are currently excluded from

combined return for Income Tax Withholding

internet filing:

and Unemployment Contributions on the

Common Pay Agents (two or more related corporations that

internet. Internet filing eliminates the need

report Maine income tax withholding on a single return).

to fill out paper forms - you enter payroll tax

Employee Leasing Companies (businesses that lease employees

information directly into your PC. When

who perform services for client companies without the client

filing over the internet for the first time, you

company having severed an employer-employee relationship).

will be asked to provide information to set

Confidential Payroll Filers (employers that have obtained

up a private account. You will then select a password that only you

Department of Labor authorization to exclude certain wage detail

know. You will be required to enter your password each time you file

information).

a return over the internet.

Master Subsidiary Filers (companies with more than one

If you have 100 or more employees or annual withholding liability

unemployment contributions account linked to the same EIN).

of $200,000 or more, you are required to report wage detail

information via magnetic media or internet or in a method approved

Unemployment Contribution Only Filers (employers that are

by Maine Revenue Services. You must select one method. You may

subject to unemployment contributions, but are not liable for

not use a combination of methods.

withholding Maine income tax).

If you have fewer than 100 employees or annual withholding liability

You can use the internet to file only for the current quarter (the

less than $200,000, you may choose to report wage detail information

calendar quarter most recently ended). You cannot use the internet

via the internet. Maine Revenue Services invites voluntary

to file an overdue return for a prior quarter, or to file an amended

participants into its electronic funds transfer programs. There are

return.

no payment minimums.

To get started with internet filing, you will need an internet browser

If you currently report wage detail information using magnetic

(Netscape or Internet Explorer, version 3.0 or higher, is sufficient).

media, you may use the internet to file your entire return including

The internet filing application will calculate your withholding

the wage detail portion. If you choose to convert from magnetic

payments and reportable wages automatically and point out any

media to internet reporting of wage detail information, the first time

errors it detects. Your employees can be listed in order either by

you do so you will have to enter names and SSNs for all employees

social security number or alphabetically in the wage detail entry

who were paid wages in that quarter.

screen. You can add or change employee information if appropriate.

You can also print a copy of any screen for your records.

Internet filers may pay by ACH Debit electronic funds withdrawal,

ACH Credit electronic funds transfer or by check. For payment by

Please visit our web site at

to start filing

ACH Debit electronic funds withdrawal or ACH Credit electronic

your combined return for Income Tax Withholding and

funds transfer, see the Electronic Funds Transfer (EFT) instructions

Unemployment Contributions over the internet, or for additional

below. If payment is made by check, the check must be submitted

information. If you need help or have questions, please call Maine

with a payment voucher.

Reveue Services at (207) 626-8475, select option 1, then option 4.

ELECTRONIC FUNDS TRANSFER (“EFT”)

Maine Revenue Services accepts both ACH credit method and ACH

payments from the taxpayer’s deposit account to the Maine Revenue

debit method payments for combined income tax withholding and

Services deposit account. The authorization is initiated through a

unemployment contributions quarterly returns (“CQR”). Both ACH

telephone call to the MRS electronic withdrawal payment system.

payment methods require applications to participate. Taxpayers

This telephone payment system allows taxpayers to arrange for

with annual withholding liabilities of $200,000 or more must pay

debit payments with effective dates up to 15 days in the future. The

electronically.

Payroll processing companies must remit

amount due shown on the return you filed will be deducted from

electronically for all clients, regardless of whether those individual

your account within 3 business days from the date you authorize

clients are mandated to pay electronically. A payroll processing

the transfer.

company may request a waiver from this requirement from the

Penalty for Insufficient Funds. The penalty for insufficient funds

Director for good cause.

Maine Revenue Services also accepts

applies to electronic funds transfers. The penalty is $20 or 1% of the

voluntary participants into its electronic funds transfer programs.

payment amount, whichever is greater.

There are no payment minimums.

Penalty for Failure to Pay by Electronic Funds Transfer. Any person

ACH Credit. A taxpayer may make payments using this method by

required to pay by electronic funds transfer who fails to do so is

authorizing their bank to withdraw the tax payment from the taxpayer’s

liable for a penalty equal to the lesser of 5% of the tax due or $5,000.

deposit account and transfer it to the state’s account. In order to

For more information, an application, or a copy of Rule 102, visit

pay using this method, you must have previously established a

and select Electronic Services; send an e-

relationship with a bank that provides this service (generally larger

mail to efunds.transfer@maine.gov; send a FAX to (207) 287-6975;

commercial banks) and you must have previously registered with

call 207-287-8276; or write to: EFT Unit, Maine Revenue Services,

the Maine Revenue Services EFT Unit as a credit method payor.

PO Box 9100, Augusta, ME 04332-9100.

ACH Debit. A taxpayer may make payments using this method by

authorizing Maine Revenue Services to electronically transfer tax

Form 941/c1-Me - Combined Filing For Income Tax Withholding And Unemployment Contributions Page 4

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