Indiana Code — Title 6 (Taxation)

IC 6-8.1-18-4

Payroll service provider; permitted to retain income generated

Official textiga.in.govlast amended 2021

on client funds
Sec. 4. Notwithstanding section 3(b)(2) of this chapter, a payroll service provider shall be permitted to retain any income generated on client funds while held in a payroll service provider's legal possession pending remittance to authorized payees if the client agreement

expressly permits it and the payroll service provider:

# (1)

complies with the National Automated Clearing House Association rules;

# (2)

maintains bank and custodial accounts for client funds that are segregated from any operating funds of the payroll service provider; and

# (3)

either:

# (A)

is a publicly held company (subject to Securities and Exchange Commission reporting, public company accounting standards, and audit requirements);

# (B)

is subject to federal or Indiana financial regulatory oversight related to the handling of client funds;

# (C)

is subject to review by partner financial institutions at least annually; or

# (D)

conducts annual SOC 1 or SOC 2 reports of security and integrity controls.
As added by P.L.97-2021, SEC.2.

Amendment history

As added by P.L.97-2021, SEC.2.

Source: view the official text

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