PrompTax: metropolitan commuter transportation mobility tax (MCTMT)

Employers required to participate in the PrompTax program for New York State withholding tax purposes, and employers who volunteer to participate in the PrompTax program for MCTMT purposes, are required to make their MCTMT payments on the same dates their withholding tax payments are due under the PrompTax program.

• If you enroll voluntarily in the PrompTax program for withholding tax but do not volunteer for MCTMT PrompTax, you must make MCTMT payments with your quarterly MCTMT return.
• All PrompTax program participants are still required to file a quarterly MCTMT return, Form MTA-305, Employer's Quarterly Metropolitan Commuter Transportation Mobility Tax Return.

Calculating the tax

For purposes of calculating the MCTMT, the Metropolitan Commuter Transportation District (MCTD) is divided into two zones:

• Zone 1 includes the counties of New York (Manhattan), Bronx, Kings (Brooklyn), Queens, and Richmond (Staten Island).
• Zone 2 includes the counties of Rockland, Nassau, Suffolk, Orange, Putnam, Dutchess, and Westchester.

Your MCTMT due for a calendar quarter is the sum of:

• your payroll expense in the calendar quarter for all covered employees in Zone 1 multiplied by the applicable MCTMT rate from Table 1 below, and
• your payroll expense in the calendar quarter for all covered employees in Zone 2 multiplied by the applicable MCTMT rate from Table 2 below.

Note: In order to be subject to the MCTMT for the quarter, the employer must have payroll expense in the entire MCTD (both Zone 1 and Zone 2) greater than $312,500.

Example: An employer has payroll expense within the MCTD of $650,000. $450,000 of that payroll expense is attributable to Zone 1 and $200,000 of that payroll expense is attributable to Zone 2. The employer’s MCTMT liability is $2,920 ([$450,000 x 0.60%] + [$200,000 x 0.11%]).

Table 1:

Table 2:

PrompTax program participants may not know at the beginning of a calendar quarter if they are subject to the MCTMT for that quarter or which rate will apply. You may follow the rules below to avoid an underpayment penalty for MCTMT PrompTax payments.

• Use the previous quarter's payroll expense to determine if you expect to be subject to the MCTMT and if you must make MCTMT PrompTax payments in the current quarter. If your total MCTD payroll expense in the previous quarter did not exceed $312,500, no MCTMT PrompTax payments are due in the current quarter.
• If you did not make any MCTMT PrompTax payments during the current quarter because your previous quarter's total MCTD payroll expense did not exceed $312,500, and your actual total MCTD payroll expense for the current quarter exceeds $312,500, you must compute and pay the tax due with your quarterly MCTMT return.
• If your total MCTD payroll expense exceeded $312,500 in the previous quarter, you may use the MCTMT rate from the charts above that applied to your payroll expense for the previous quarter to compute the MCTMT PrompTax payments due in the current quarter.
• If your payroll expense for the quarter ending June 30, 2023, was greater than $437,500 and attributable to Zone 1, you should use 0.60% to compute the MCTMT PrompTax payments due in the quarter beginning on July 1, 2023.
• At the end of each quarter, you must compute your actual MCTMT liability using the rate that applies to your actual payroll expense for the quarter. Remit any unpaid tax with your quarterly MCTMT return. If your return results in an overpayment made through PrompTax, you may request a refund or have the overpayment credited to the next quarter.

How to pay

If you are required or choose to pay the tax on the same schedule as your PrompTax withholding tax payments, you must use the PrompTax system and pay by one of three available options: ACH debit, ACH credit or Fedwire. There is no paper (certified check) payment option. 

Note: See Technical support solutions to view our new minimum browser requirements for credit card and PrompTax payments.

For more information, see:

• Publication 420, Guide to the Metropolitan Commuter Transportation Mobility Tax
• MCTMT forms and instructions
• MCTMT TSB-Ms