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 elect to participate in the PrompTax program for metropolitan commuter transportation mobility (MCTMT) purposes, are required to make MCTMT payments on the same dates withholding tax payments are due under the PrompTax program.

• If an employer elects to enroll in the PrompTax program for withholding tax but does not enroll for MCTMT PrompTax, it must make MCTMT payments with the 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

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.

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

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

Note: To be subject to the MCTMT for the quarter, the employer must have payroll expense in the entire MCTD greater than $312,500.

Table 1a: Zone 1 MCTMT for quarters beginning before July 1, 2025

Table 1b: Zone 1 MCTMT for quarters beginning on or after July 1, 2025

Important: Local government employers are not subject to the 0.895% rate for payroll expense in Zone 1 over $2,500,000. Instead, they are subject to an MCTMT rate of 0.60% for payroll expense in Zone 1 that exceeds $2,500,000. See Employers: metropolitan commuter transportation mobility tax (MCTMT) for the definition of a local government employer.

Table 2a: Zone 2 MCTMT for quarters beginning before July 1, 2025

Table 2b: Zone 2 MCTMT for quarters beginning on or after July 1, 2025

Important: Local government employers in Zone 2 are not subject to the MCTMT.

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 $2,810 ([$450,000 x 0.60%] + [$200,000 x 0.055%]).

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. Participants may follow the rules below to avoid an underpayment penalty for MCTMT PrompTax payments.

• Use the previous quarter's payroll expense to determine if MCTMT PrompTax payments are required in the current quarter. If the total MCTD payroll expense in the previous quarter did not exceed $312,500, no MCTMT PrompTax payments are due in the current quarter.
• If the employer did not make any MCTMT PrompTax payments during the current quarter because the previous quarter's total MCTD payroll expense did not exceed $312,500, and the actual total MCTD payroll expense for the current quarter exceeds $312,500, the employer must calculate and pay the tax due with the quarterly MCTMT return.
• If the total MCTD payroll expense exceeded $312,500 in the previous quarter, use the MCTMT rate from the charts above that applied to the payroll expense for the previous quarter to calculate the MCTMT PrompTax payments due in the current quarter.
• At the end of each quarter, calculate the actual MCTMT liability using the rate that applies to the actual payroll expense for the quarter. Remit any unpaid tax with the quarterly MCTMT return. If the return results in an overpayment made through PrompTax, the employer may request a refund or have the overpayment credited to the next quarter.

How to pay

If the employer is required or chooses to pay the tax on the same schedule as the PrompTax withholding tax payments, they 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