Purpose: 

The purpose of this bulletin is to notify agencies of changes in maintenance rates for employee housing and meals and explain agency responsibility for maintaining correct rates.

Affected Employees: 

Employees with deductions for employee housing and/or meals using Deduction Code 401 (Taxable Maintenance) or 402 (Non-Taxable Maintenance) are affected.

Background: 

The NYS Division of the Budget issued revisions to Budget Bulletins B-300 (Rev) and B-300A (Rev) updating maintenance rates effective August 27, 2025. 

Note: these Bulletins include information for specific unions/bargaining units. 

The Determining Taxability of Maintenance Deductions attachment can be used as a guideline for establishing the taxable status of maintenance deductions for State employees.

Effective Dates: 

The changes outlined in Budget Bulletins B-0300 (Rev) and B-0300A (Rev) are effective as of August 27, 2025.

OSC Actions: 

OSC has created Control-D report NBEN725 (Employees with Maintenance Deductions) to identify employees in each agency who have maintenance deductions. 

Agency Actions: 

Agencies are required to become familiar with IRS regulations on employer provided lodging, specifically the conditions for excluding the value of employer provided lodging from employee’s taxable income, and to make appropriate procedural changes to ensure compliance. If an agency provides housing at no charge to an employee and the IRS nontaxable criteria for housing is not met, the value of the housing is considered taxable income and is subject to all tax withholdings and must be reported on the employee’s Form W-2. State agencies, apart from SUNY, should notify OSC’s Tax and Compliance Team if they are providing housing to employees without charge. SUNY agencies should refer to Payroll Bulletin SU-188 for further guidance on how to report this income. Please see IRS Publication 15-B (Employer’s Tax Guide to Fringe Benefits) for additional information and guidance.

Agencies must review Control-D report NBEN725 (Employees with Maintenance Deductions) bi-weekly to identify any over payments or discrepancies in rates. Agencies must also review all new hires or transfers into the agency to determine if they have an active 401 or 402 deduction and update or end date the deduction as appropriate by inserting a new effective dated row on the General Deductions page. The effective date should be the first day of the pay period for the check date in which the deduction will be effective. 

NOTE: This deduction should be immediately end dated when an employee is no longer receiving employer provided maintenance. 

Questions: 

Budget Bulletins B-300 (Rev) and B-300A (Rev) are available from the NYS Division of the Budget at:  https://www.budget.ny.gov/guide/bprm/b/b-0000.html.

Tax-related questions regarding this bulletin may be directed to the Tax and Compliance mailbox. 

Deduction related questions regarding this bulletin may be directed to the Payroll Deduction mailbox.