Payroll processor bond cost
The Maine Bureau of Consumer Credit Protection requires payroll processors to post surety bonds to be licensed to work within the state. The required bond amount varies depends on the volume of business conducted by the processor. The bond amount is equal to $100,000 or the total of all local, state and federal tax payments/unemployment insurance premiums processed in the 3-month period of highest volume during the previous calendar year, whichever is greater. Regardless, the bond amount cannot exceed $500,000. To ensure you purchase the correct amount of bond coverage, verify your required bond amount with the state.
These bonds are subject to underwriting consideration, so the amount you pay depends on your required bond amount and a review of your personal credit report.
Why this bond
Maine payroll processor surety bonds guarantee that principals (payroll processors) perform their duties in compliance with Title 10 M.R.S.A, Chapter 222. The purpose of this bond is to ensure that payroll processors provide accurate accounts of all payroll issued/disclosure statements and pay the state all required taxes and fees required by law.
If a processor fails to abide by all applicable rules and regulations and a valid claim is made against the bond, the surety will cover damages to harmed parties up to the full bond amount. The principal must then reimburse the surety for damages paid out.
Payroll processor bonds in Maine are continuous until canceled. The surety can cancel the bond by giving written notice of cancellation via certified mail to the principal and the Superintendent of the Bureau of Consumer Credit Protection of the State of Maine. Cancellation becomes effective 30 days after the receipt of said notice.These bonds must be acknowledged by a certified notary public.
Become a payroll processor
To become a licensed payroll processor in Maine, applicants must submit a completed application form with the following information:
- full trade name (including DBA)
- address of location to be licensed
- address of home office, if different
- type of business entity being licensed
- federal ID number
- sample of the periodic report to employer required by Maine law
- surety bond in the proper amount
- and more
Apply for your surety bond
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