Division of Finance & Administration

Tax Services

Tax administration support for staff, faculty, & students in navigating tax laws (VT sales & use tax, unrelated business income tax, payments to foreign nationals & corporations, etc) is provided by the Payroll & Tax Services team within University Financial Services (UFS). We also administer the University's required federal, state, & local tax filings.

Out-of-state employees

Payroll and Tax Services needs to be notified of any paid employee (student, staff, faculty, or graduate student) doing any portion of their work for UVM outside the state of Vermont. This allows us to ensure our capabilities and compliance with payroll, unemployment, and withholding tax law. Payroll and Tax also informs Risk Management to ensure we have proper coverage for Worker’s Compensation. It is to the benefit of both the employee and the University to ensure Payroll and Tax are provided with this information before any work commences and when a work location changes.

PeopleSoft Self-Service now has the ability to notify payroll and tax electronically of work being done outside of Vermont. Once logged into PeopleSoft Human Resources, go to the UVM Employee screen and select the Payroll and Tax tile. Once there employees will see a link on the left side of the screen connecting them with the Out-of-State Form. See the User Guide (PDF) for further instructions.

Other notices

Please note: The turnaround time for foreign check requests is 10 business days from the date Payroll & Tax Services (Waterman 237) receives a complete packet.
The Employee vs. Independent Contractor Policy (PDF) has been revised. Refer to the Employee vs. Independent Contractor policy/procedure training slide deck (PDF) for information on the new determination process.

2018 Tax Law and Job Cuts Act

Effective January 1, 2018, the Tax Law and Job Cuts Act has the following impact on departments, and the University:

Departments

The biggest change is the taxability of relocation reimbursement. In the past, part of this was allowable/non-taxable. Effective 1/1/18, amounts paid to a new employee for the reimbursement or payment of relocation expenses, including payments made by the University to third parties on behalf of the employee (i.e. payments to moving companies), will be subject to federal withholding tax and FICA. If your department is hiring and providing relocation assistance, please note in the hiring documentation to the new employee that all relocation expenses will be fully taxable. All relocation payments will need to be paid through Payroll via an Additional Pay Form to be taxed accordingly using a new earnings code (429). See the Relocation University Operating Procedure (PDF).

University-level

Activities subject to Unrelated Business Income Tax (UBIT) can no longer be aggregated to offset gains with losses. Under the new law, each activity must be segregated: those with profits will have to pay UBIT, and those with losses will accumulate losses. Payroll & Tax Services will be working with units that have activities subject to UBIT. In addition, some fundraising activities may be affected; for example, when athletic tickets are given in exchange for a donation, the donation is no longer tax-deductible. Many other provisions for colleges and universities in the law do not apply to UVM because we are too small. Contact Payroll & Tax Services at 656-6600.

Foreign nationals/nonresident aliens

We provide guidance in hiring foreign nationals for employment or as independent contractors or honorarium recipients, providing a scholarship/fellowship/award, or making a payment to foreign corporations performing services in the U.S. For more information, see the Paying Foreign Nationals & Entities flowchart & checklist (PDF), email taxadmin@uvm.edu or read the Payments to Foreign Nationals and Entities Policy (PDF).

Unrelated Business Income Tax (UBIT)

UVM is exempt from federal income taxation as a 501(c)(3) tax-exempt organization; however, the university is required to pay federal income tax on net income from activities that are unrelated to the three key components of the tax-exempt mission of the university: teaching, research, and public service. Unrelated Business Income Tax (UBIT) is the federal income tax imposed on the Unrelated Business Income (UBI) generated by tax-exempt organizations. Read more about UBIT . . .