Agencies are encouraged to promote electronic-only access to year-end forms. The following information is provided to distribute to employees.

To avoid waiting for your 2024 Form 1095-C or your 2024 W-2 to arrive by mail, you can opt to go paperless only. When you choose to go paperless only, you will receive an electronic copy of the documents that can be downloaded and printed earlier than if electing both paper and electronic. Once you elect to receive an electronic-only copy, you do not need to do so again in the future. A 1095-C user guide and a W-2 user guide have been created to assist you in opting out of receiving the documents by mail. Those who have elected to receive both electronic and paper copies for their year-end documents will have them mailed by the required deadlines. Electronic versions will also be available by the deadlines. W-2s are due to employees by Jan. 31, 2025. 1095-C forms are due by March 3, 2025.

In planning your work for December, it is important to remember that the state holidays for Christmas this year are Tuesday and Wednesday, Dec. 24 and 25. Additionally, the New Year’s Holiday is observed on Wednesday, Jan 1, 2025. The December biweekly payroll for state agencies will be paid on Friday, Dec. 13, and Friday, Dec. 27. December monthly payrolls will be paid on the last working day of the month, Tuesday, Dec. 31. With these dates in mind, staff should plan their work accordingly for the holiday deadlines: 

Biweekly: The last biweekly payroll will be Friday, Dec. 27. Agencies must have these payrolls processed and paperwork forwarded to OMES by noon on Wednesday, Dec. 18.

Monthly: Monthly payrolls will be set to pay on Tuesday, Dec. 31. Agencies must have these payrolls processed and paperwork forwarded to OMES by noon on Friday, Dec. 20.

Listed below is contact information for OMES personnel working on the IRS reporting project for tax year 2024. The fax number is 405-522-2186.

• Lisa Raihl, Payroll director – 405-521-3258.
• Jean Hayes, Payroll compliance officer – 405-522-6300.
• Alicia Reel, Payroll specialist – 405-522-1099.
• Felicia Clark, state comptroller – 405-717-8865.
• Sharon Saunders, Benefits supervisor; 405-522-1181.
• Mechele Berry, Benefits director.

Agencies should review all employee corrections for the year to ensure they have been processed by OMES HCM Central Payroll as requested. This includes cancellation of payroll warrants, overpayment refund requests, Social Security number changes and any other requests that affect W-2 reporting. For any requests identified as not yet processed, please email Jean Hayes or Alicia Reel at payrollreporting@omes.ok.gov for a status update.

Agencies should review all outstanding employee overpayments and collect required amounts from employees. After collection, submit OMES Form 94P as applicable. Agencies will be entitled to receive refunds for all forms that were submitted by Friday, Dec. 13, 2024. After this date, refunds cannot be returned to the agencies; however, agencies are still required to submit the form after this date for employee wage corrections. Corrections due to overpayments will be posted to the employee’s 2024 W-2 for requests submitted through Friday, Jan. 3, 2025. Any corrections submitted after Jan. 3 will require a corrected W-2 or W-2C as applicable.

Employee overpayments collected in the next calendar year are to be repaid at the gross overpayment amount in accordance with IRS regulations. If an employee owes the agency, notify the employee that if the amount is not paid in full by Dec. 31, 2024, the amount due will increase to the gross amount.

In accordance with 74 O.S. § 840-2.19, the agency must send a notice to the employee within 10 days of identifying an overpayment. The employee then has 30 days to respond to this notification. Employees have several options for repaying overpaid payroll amounts:

• Reduction of annual leave (for the gross overpaid).
• Reduction of current gross salary (for the gross overpaid) in a lump sum or installments over a term not to exceed the term in which the overpayment(s) occurred.
• Lump-sum cash repayment.
• Miscellaneous payroll deduction (for the net overpaid in the current year, gross for a subsequent year) in a lump sum or installments over a term not to exceed the term in which the overpayment(s) occurred.
• Any combination of the above options.

With the calendar year-end here, the collection of any outstanding overpayment is especially important and must be conveyed to employees who owe any monies back to the agency. When an overpayment is reimbursed in a subsequent year, IRS rules state the employee must reimburse at the gross amount because the funds were available for use in the prior year and, as such, they are taxable to that year. Additionally, federal and state wages and taxes cannot be reduced for prior years when repayments are made after the end of that calendar year.

For example, John Doe was overpaid in August by $1,000 regular wages. This was discovered in September, and the agency calculated what the correct payroll should have been. The net check difference is $743.50, the amount the employee owes the agency if making the reimbursement by personal check or miscellaneous deduction in the current year. If the employee does not reimburse the net amount by Dec. 31, 2024, the employee owes the agency the full $1,000 gross overpayment.

If the employee reimburses the entire gross amount after year-end, the applicable W-2, corrected W-2, or W-2C will only reflect a change in the Social Security and Medicare wages and taxes. Since the employee received and had use of the funds during the year of overpayment, the amount is still taxable for federal and state purposes. The W-2 form will not correct federal or state taxable wages or income taxes. The employee may be entitled to either a deduction or credit on their current year Form 1040 and should be advised to speak to their tax accountant.

Any taxable fringe benefits not yet recorded and reported this year must be included in the December payroll. The HCM payroll system has been structured to accommodate the reporting of noncash, taxable fringe benefits. Of specific concern to state employees, the following benefits should be reviewed to determine if W-2 wage adjustments are necessary:

• Employee use of state vehicles.
• Maintenance, car and housing allowances.
• Additional noncash benefits.

Reporting of these benefits is required by state and federal law, and it is the responsibility of the individual agency to ensure compliance. If the item is not run through the payroll system in the current year, the employer may deduct the taxes associated with the wage item on a following paycheck in the next year as a miscellaneous deduction. The state is responsible for depositing the taxes. Any taxes associated with items not run through the payroll system must be sent to OMES HCM Central Payroll in a timely manner so the tax deposits can be made and the items posted to the employee’s earnings record.

Refer to the W-2 instructions and Publication 15A, Employer’s Supplemental Tax Guide, for additional information. Also, refer to OMES Human Capital Management rules to determine whether these payments are a valid pay plan for a particular agency.

Employee overpayments collected in the next calendar year are to be repaid at the gross overpayment amount in accordance with IRS regulations. If an employee owes the agency, notify the employee that if the amount is not paid in full by Dec. 31, 2024, the amount due will increase to the gross amount.

In accordance with 74 O.S. § 840-2.19, the agency must send a notice to the employee within 10 days of identifying an overpayment. The employee then has 30 days to respond to this notification. Employees have several options for repaying overpaid payroll amounts:

• Reduction of annual leave (for the gross overpaid).
• Reduction of current gross salary (for the gross overpaid) in a lump sum or installments over a term not to exceed the term in which the overpayment(s) occurred.
• Lump-sum cash repayment.
• Miscellaneous payroll deduction (for the net overpaid in the current year, gross for a subsequent year) in a lump sum or installments over a term not to exceed the term in which the overpayment(s) occurred.
• Any combination of the above options.

With the calendar year-end here, the collection of any outstanding overpayment is especially important and must be conveyed to employees who owe any monies back to the agency. When an overpayment is reimbursed in a subsequent year, IRS rules state the employee must reimburse at the gross amount because the funds were available for use in the prior year and, as such, they are taxable to that year. Additionally, federal and state wages and taxes cannot be reduced for prior years when repayments are made after the end of that calendar year.

For example, John Doe was overpaid in August by $1,000 regular wages. This was discovered in September, and the agency calculated what the correct payroll should have been. The net check difference is $743.50, the amount the employee owes the agency if making the reimbursement by personal check or miscellaneous deduction in the current year. If the employee does not reimburse the net amount by Dec. 31, 2024, the employee owes the agency the full $1,000 gross overpayment.

If the employee reimburses the entire gross amount after year-end, the applicable W-2, corrected W-2, or W-2C will only reflect a change in the Social Security and Medicare wages and taxes. Since the employee received and had use of the funds during the year of overpayment, the amount is still taxable for federal and state purposes. The W-2 form will not correct federal or state taxable wages or income taxes. The employee may be entitled to either a deduction or credit on their current year Form 1040 and should be advised to speak to their tax accountant.

Please verify the correct agency address is being used in Workday@OK. The agency address can be found on the Employee’s Earnings Statement. Submit a ServiceNow ticket to have the agency's address updated in PeopleSoft Financials.

Please communicate to employees the need for an updated address in the system as this will be used

OMES will have electronic W-2s ready by Jan 17, 2025. Those who have elected to receive both electronic and paper copies for their year-end documents will have them mailed by the required deadline, and their electronic versions will also be available by the deadlines. W-2s are due to employees by Jan. 31, 2025.

Dec. 13, 2024 – Last day that a refund of taxes due to overpayments can be returned to agencies (refer to Employee overpayments and OMES Form 94P submission).

Dec. 26, 2024 – Last day OMES will process payrolls for calendar year 2024. Payrolls must be received by noon. Any payrolls received after this deadline will not process to pay in 2024. 

Jan. 3, 2025 – Payroll warrant cancellations, OMES Form 94Ps and earning adjustments for calendar year 2024 must be received by OMES no later than 5 p.m. Any 2023 payroll information received after this date will require a corrected W-2 from the agency. 

Jan. 17, 2025 – W-2 forms will be available to employees electronically. (refer to above article).

Jan. 24, 2025 – Last date to submit corrected W-2 forms for file submission (refer to Correcting W-2 forms).

Jan 31, 2025 – Printed W-2 forms will be mailed to employees. (refer to 2024 1095-C and W-2 electronic option in Workday@OK).

Jan. 31, 2025 – Deadline for delivering forms to employees.

Feb. 15, 2025 – Form W-4 with exemption expires (refer to Federal income tax withholding).

Corrected W-2 forms must be delivered to OMES HCM Central Payroll by Jan. 24, 2025, for the corrections to be in the submission file. The due date for submission of form W-2 information to the IRS is Jan. 31, 2025.

Please send the original W-2, a copy of the corrected form and a memo explaining why the correction is needed. If the correction is due to a statutory canceled warrant which is not to be replaced, please also send a letter asking that the warrant not be replaced. 

Note: A warrant canceled by statute is not a reason for such a W-2 correction. If it is a valid payroll payment, the employee is still entitled to a replacement warrant; therefore, the W-2 reporting is proper.

Exempt from withholding: An employee who certified to his or her employer on the 2024 Form W-4 that the employee had no income tax liability for 2023 and anticipated no income tax liability for 2024 was entitled to an exemption from withholding for 2024. This exemption expires on Feb. 15, 2025, and must be renewed if conditions remain the same. To claim exempt status, the employee must complete a new federal tax withholding election in Workday@OK. Only Step 1 (marital status), the Exempt box (checked) and Step 5 (legal notice) should be completed. If the entry is made after Feb. 15, 2025, the W-4 will take effect on the next pay cycle; per IRS regulations, it is not retroactive to the beginning of the year.

Lock-in letter: The IRS has been issuing Letter 2800C, WHC Lock-In Letter to Employer, with the permitted filing status and withholding instructions based on the new W-4, which is no longer using withholding allowances. Follow all instructions in the letter – enter the information into Workday@OK and select the Lock-in Letter field. Provide the employee their copy and begin withholding based on the date specified in the notice. If an employee has a lock-in letter in effect and submits a new W-4, you must ensure the new W-4 does not result in less being withheld than required by the IRS. If so, you cannot enter the W-4 and you must let the employee know it will not be entered in the system.

Year 2024 rates are provided for comparison purposes. View the table here.

The Social Security Administration is mailing educational correspondence to employers that submit W-2 forms containing employee names and Social Security numbers that do not match the SSA’s records. This letter provides employers with resources to help ensure accurate year-end reporting. Employers may also receive letters if there are any name/SSN errors on W-2 reporting. The letters come directly to OMES. Agencies will be notified of any name/SSN errors on the report that applies to the agency.

Along with the SSA letters discussed in the article above, IRS information reporting penalties may apply for failure to file and failure to furnish correct information returns. A penalty for failure to file correct information returns can be up to $330 per form, indexed annually. A penalty for failure to furnish a correct information return could also apply to the same error if an employer furnished an incorrect form to an employee and failed to file a correct Form W-2. If both penalties are assessed, the amount could be as much as $660 per Form W-2. In addition, the penalty applies to the ACA reporting Form 1095-C. For one employee with an incorrect name/SSN combination who receives both a W-2 and a 1095-C, the total penalty could be as much as $1,320. IRS enforcement of accuracy-related penalties is evolving, and penalty assessment may be increasing.

OMES verifies employee name and SSN combinations several times throughout the year through the SSA website. Agencies with mismatched results are notified and are required to correct the wrong information timely to ensure year-end reporting is correct. This process helps to ensure accurate reporting and reduces the risk of information reporting penalties.

When entering a new employee’s name and Social Security number or updating a current employee’s name, please verify the name and SSN being entered is exactly as it appears on the employee’s Social Security card. This is critical in reporting not only the W-2 wages at year-end but also the Affordable Care Act-required health offer/coverage information. If the name and SSN do not match the Social Security Administration records, the employee’s wages may not be credited to their Social Security account. Additionally, if the name and SSN do not match, the employee may not be reported correctly for ACA purposes which could result in an IRS letter to the employee for possible lack of health coverage or an IRS letter to the agency for not offering coverage.

Since September 2007, when the SSA updated the Social Security card, the cardholder’s name will always be printed on two lines with the last name printed directly below the first and middle names. If you receive a prior version from an employee and are unsure, ask the employee to verify the first, middle and last names listed.

Additionally, compound names do not need to be hyphenated. If an employee provides a name with an apparent compound or multiple last names, ask the employee which name is the beginning of the last name and which (if any) is the middle name.

Please ensure the employee completes the business process in Workday@OK in a timely manner. Not having the information entered will cause issues with year-end reporting. In addition, other required processes and reporting are delayed when this information is not timely entered and in a complete status, such as E-Verify, new hire report and retirement files.

You may enter the name that the employee currently uses as their preferred name if desired so that their paycheck will continue to reflect the same name as in the past, but the employee record and W-2 information should match the Social Security card for the legal name.

In planning your work for December, it is important to remember that the state holidays for Christmas this year are Tuesday and Wednesday, Dec. 24 and 25. Additionally, the New Year’s holiday is on Wednesday, Jan. 1, 2025. With these dates in mind, please adjust your payroll processing schedules as needed. All payroll documents must be received by 3 p.m. five business days prior to the actual pay date to ensure adequate time for audit and processing.

Transparency (OpenBooks) files are due no later than the fifth business day of the following month. Files must be sent promptly in order to comply with monthly FTE reporting as well as statutory requirements for posting the data to the website. The following are specific field data reminders:

• Hours – must be an employee’s accurate hours. The hours reported here will also be used for FTE reporting, along with the pay frequency entered in the file.
• Warrant Number – must contain the required leading 2. This is the actual warrant number processed through the state’s financial system and paid through the treasurer’s office.
• Pay Date – must be the actual warrant issue date processed through the state’s financial system and paid through the treasurer’s office.

Pursuant to 26 U.S. Code § 6056 of the Patient Protection and Affordable Care Act, as a large employer we are required to file an informational return with the IRS related to the offer of health coverage to employees. Additionally, we must provide employees with a statement that includes the information we will provide in our IRS filing. This employee statement is the IRS Form 1095-C, which includes information about health insurance coverage offered to state employees, their spouse and dependent(s).

For employees who have worked in multiple agencies during the year, only one 1095-C form will be produced. This combined 1095-C form includes information related to the employee across multiple agencies.

Note: Only employees eligible for an offer of health coverage or those in a stability period with an offer of coverage will receive a 1095-C form for 2024. Not all employees will receive a 1095-C form.

Feb. 3, 2025 – Last day for agency updates to be provided to OMES Benefits for the 1095-C forms to be correct. Changes to 2024 data after this date must be communicated for accurate 2024 reporting. For changes, submit a ServiceNow ticket to OMES Benefits.

Mar. 14, 2025 – Last date to submit corrected 1095-C forms for file submission (refer to the article below).

OMES tentatively will have electronic 1095-C forms ready by Feb. 18, 2025. Employees who do not elect to receive an electronic-only 1095-C will have their form printed and mailed by March 3, 2025.

In addition to the 1095-C form, state agency employees enrolled in health coverage will receive a 1095-B form from their insurance carrier. The 1095-B form provides information about who was covered and the periods of coverage. For questions related to ACA reporting, submit a ServiceNow ticket to OMES Benefits.

Corrections for Form 1095-C must be submitted to OMES HCM by Mar. 14, 2025. Send the original form, a copy of the corrected form and a memo explaining why the correction is needed. Submit a ServiceNow ticket to OMES Benefits.

All 1099 forms will be distributed as an Adobe PDF file through email, between Jan. 14-17, 2025.

Email your agency contact information to OMES Central Payroll with the following details for a primary and alternate contact:

• Agency number.
• Agency name.
• 1099 Contact name.
• 1099 Contact phone.
• 1099 Contact email.

Note: This does not apply to higher education institutions; they will process their own 1099 reporting.

Agencies will be responsible for printing all 1099 Forms.  All 1099 forms can be printed on traditional 8½ x 11 white paper.  The forms can be trifolded and will fit in a Standard No.10 windowed envelope. Sample printed forms can be provided if requested. For sample forms, contact Alicia Reel at 405-522-1099 or alicia.reel@omes.ok.gov.

Note: This does not apply to higher education institutions; they will process their own 1099 reporting.

The year-end 1099 Report is available for each agency to run in PeopleSoft Financials at any time. The path for this report is:  Accounts Payable > Reports > Payments > Misc Tax Information Report. 

Make sure the dates include 01/01/2024-12/31/2024. This report will reflect the 1099 data from PeopleSoft vouchers. Any vendor with a 1099 Flag of N on the report will NOT receive a 1099 unless they are paid using a medical or legal account code.

The final report should be processed by agencies no later than Jan. 3, 2025, or preferably by Dec. 31, 2024. 

For changes to a vendor 1099 flag, agencies must submit an updated W9 from the vendor to OMES Central Purchasing Supplier Registration by Jan. 7, 2025.

Note: This does not apply to higher ed institutions, which will process their own 1099 reporting.

Any agency needing to submit an additional file for 1099-MISC reporting should use the format listed in the OMES CAR Forms page. Instructions are provided in a separate link as well as a listing of 1099 reportable account codes. Due to the sensitive nature of the data, please email your password-protected file to alicia.reel@omes.ok.gov. It is recommended that these agencies submit a test file by Dec. 15, 2024, to have a name and TIN match done with the IRS. Final information is due Jan. 7, 2025.

These file instructions and format can be found on the OMES CAR Forms page:

• 1099 Detail File Format – Outside Agencies.
• 1099 Instructions – Detail File Format.
• 1099 Account Code Cross-Reference.

Beginning with tax year 2020 the IRS reintroduced Form 1099-NEC to report nonemployee compensation (formerly Box 7 on 1099MISC). This form will only contain nonemployee compensation reported in Box 1 and reporting to the IRS will be due by Jan. 31, 2025. Any corrections will be required to be returned by Jan. 24, 2025, so they can be entered in the file which is due to be filed with the IRS by Jan. 31, 2025. Any corrections needed after this date should still be sent to OMES for correction and notification to the IRS. This will ensure our reporting is as accurate and complete as possible. The IRS has revised Form 1099-MISC for reporting all other types of income.

Please note the following procedures pursuant to such changes to 1099 documents:

• For missing addresses or address changes to the 1099 document only, email a copy of the updated W9 to alicia.reel@omes.ok.gov.
• If a change to the permanent vendor file is needed, submit an updated W-9 to OMES Central Purchasing Supplier Registration. Attach the updated W9 with your request.
• For name or FEI/SSN changes to the 1099 document only, email a copy of the updated W9 to alicia.reel@omes.ok.gov.
• If a change to the permanent vendor file is needed, submit an updated W-9 to OMES Central Purchasing Supplier Registration. Attach the updated W9 with your request.
• For all amount changes to the 1099 document, email your change to alicia.reel@omes.ok.gov. Send the appropriate documentation that explains the nature of the transaction changes. 
• Any changes that need to be made after Jan. 24, 2025, must be sent to OMES as soon as possible, and we will forward the information to the IRS.

Note: This does not apply to higher ed institutions, which will process their own 1099 reporting.

The Tax Cuts and Jobs Act of 2017 added 26 U.S. Code § 6050X, which imposes a reporting requirement on certain government entities involved in settlements where 26 U.S. Code § 162(f) applies. Section 162(f)(1) disallows any deduction for amounts paid or incurred by a taxpayer, to or at the direction of a governmental entity, for violation of a law or the investigation or inquiry by such entity into the potential violation of a law. However, Section 162(f)(2) provides exceptions for amounts related to restitution, remediation and costs incurred by a taxpayer to come into compliance with a law.

Beginning with tax year 2022, the IRS required governmental entities to file IRS Form 1098-F for amounts required to be paid pursuant to a suit, court order or agreement with respect to any violation of law or the investigation or inquiry into the potential violation of a law, if the aggregate amount involved in all suits, orders or agreements in relation to the violation of the law equals or exceeds $50,000 (threshold may change in future years).

• Reporting is required for a suit, order or agreement that becomes binding on or after Jan. 1, 2024.
• The amount required to be paid includes costs to provide services or to provide property.
• A separate Form 1098-F must be filed with respect to each payer that is a party to the suit, order or agreement.
• Form 1098-F is not required for any person who does not have a payment obligation or obligation for costs to provide services or to provide property.
• Forms are due to payers by Jan. 31, 2025.

Instructions for IRS Form 1098-F.

An IRS Form 1098-F Reporting Document has been created for state agencies to provide OMES with the required information to create the 1098-F forms. Submit the completed document as soon as possible but no later than Jan. 17, 2025, to payrollreporting@omes.ok.gov.

Note: Institutions of higher education will not submit any information to OMES for 1098-F reporting. Please consult your tax accountant if you feel reporting may be required.

Agencies that have collected backup withholding on miscellaneous claims, must submit payment to be received by OMES prior to Dec. 31, 2024. Make interagency wires payable to the State Contribution Fund (Vendor 0000000467, ADDR # 002, LOC # 0002). After processing the payment, please notify OMES Central Payroll.

The 2025-Valid EFT Date Calendar is ready for your agency in preparation for submission of your EFT transactions. Please use the calendar to ensure that your EFT items process with the effective dates intended. The letter “H” identifies holidays on the calendar. The state’s 2025 holidays correspond with the federal institution/bank holidays with the exception of these four:

• Juneteenth – 6/19/2025.
• Columbus Day – 10/13/2025.
• Additional Thanksgiving Holiday Observed – 11/28/2025.
• Additional Christmas Holiday Observed – 12/24/2025.

If your agency sends EFT items effective for these dates, the treasurer’s office will change the date to the next valid EFT date.

If you have questions concerning the calendar, contact Nancy Rooker at nancy.rooker@treasurer.ok.gov or 405-521-3121.