Employer-Provided Health Coverage Informational Reporting Requirements: Questions and Answers Starting in tax year 2011, the Affordable Care Act requires employers to report the cost of coverage under an employer-sponsored group health plan. To allow employers more time to update their payroll systems, Notice 2010-69, issued last fall, made this requirement optional for all employers in 2011. IRS Notice 2011-28 provided further relief by making this requirement optional for smaller employers in calendar-year 2012. Notice 2011-28 also provides guidance for employers that are subject to this requirement for the 2012 Forms W-2 and those that choose to voluntarily comply with it [...]

WASHINGTON — The Internal Revenue Service today announced cost of living adjustments affecting dollar limitations for pension plans and other retirement-related items for Tax Year 2012. In general, many of the pension plan limitations will change for 2012 because the increase in the cost-of-living index met the statutory thresholds that trigger their adjustment. However, other limitations will remain unchanged.  Highlights include: The elective deferral (contribution) limit for employees who participate in 401(k), 403(b), most 457 plans, and the federal government’s Thrift Savings Plan is increased from $16,500 to $17,000. The catch-up contribution limit for those aged 50 and over remains [...]

The IRS has released a list of states that have defaulted on their 2011 Federal Unemployment Insurance Loans causing employers in these states to owe additional FUTA tax for the tax year 2011. The following are the FUTA tax rate increases for the affected states:   0.9 percent for Michigan 0.6 percent for Indiana 0.3 percent for Arkansas, California, Connecticut, Florida, Georgia, Illinois, Kentucky, Minnesota, Missouri, North Carolina, New Jersey, Nevada, New York, Ohio, Pennsylvania, Rhode Island, Virginia, Virgin Islands, and Wisconsin This rate will be applied to the 1st $7,000.00 that each FUTA taxable employee earned for the tax [...]

Year-end Cutoff Date The year-end cutoff date for you to report changes for 2011 is December 30, 2011 at 1:00 p.m., or the day a payroll with a January 2012 check date is processed, whichever is earlier.  We recommend that you run any adjustments with a payroll to ensure that the taxes are withheld correctly.  Please remind your accountant to report payroll adjustments no later than your cut-off date. If payroll adjustments are necessary after the year-end cutoff date, we can rerun your tax returns.  However, there will be an additional charge and a processing delay.  Depending on when you [...]

Remember, next week is Thanksgiving and the banks will not be able to process ACH/Direct Deposit transactions on  Thursday, November 24th – Thanksgiving Day If you normally date your checks for Thursday, we will need your payroll information by 3pm on Monday for a Wednesday check date or 3pm on Tuesday for a Friday check date. If you normally have a Monday check date, we will need your payroll information by 3pm on Wednesday. However, we can always move your check date to a later date if that better suits your needs. If you have any questions regarding the upcoming [...]

What is the FUTA Credit? Under the provisions of the Federal Unemployment Tax Act (FUTA), a Federal tax is levied on employers covered by the Unemployment Insuranceprogram at a current rate of 6.2% on wages up to $7,000 a year paid to a worker. The law, however, provides a credit against Federal tax liability of up to 5.4% to employers who pay state taxes timely under an approved state UI program. Accordingly, in states meeting the specified requirements, employers pay an effective Federal tax of 0.8%, or a maximum of $56 per covered worker, per year. The credit against the [...]

Recently, the IRS and many states mailed out Deposit Requirement notices for those companies that have a change in deposit frequency for 2012. If you received one of these notices, it is imperative that you forward a copy to our office as soon as possible to avoid penalties in 2012. See below for some sample letters. As always, if you receive any notice from the IRS or your state, please forward to us at your earliest convenience.    

As many as 17 states are increasing their SUI Wage Base. Some states have yet to report their 2012 wage base. Below is a listing of reported 2012 SUI wage bases compared to 2011. State 2012 Wage Base 2011 Wage Base Alabama $8,000 $8,000 Alaska 34,600 Arizona 7,000 7,000 Arkansas 12,000 12,000 California 7,000 7,000 Colorado 11,000 10,000 Connecticut 15,000 15,000 Delaware 10,500 10,500 District of Columbia 9,000 9,000 Florida 8,500 7,000 Georgia 8,500 8,500 Hawaii 34,200 Idaho 33,300 Illinois 13,560 12,740 Indiana 9,500 9,500 Iowa 25,300 24,700 Kansas 8,000 8,000 Kentucky 9,000 8,000 Louisiana 7,700 Maine 12,000 12,000 Maryland [...]