Vision Payroll

Advances in online technology have reinforced how the Internet has become an increasingly necessary and unavoidable recruitment tool for small companies to leverage. There are three important areas employers must consider when implementing successful on-line recruiting strategies: on-line recruiting, legal landmines, and employer action items.

You’ll learn much more about these three areas in this month’s HRCast, a recording provided by our team of HR Pros and available exclusively on MyHRSupportCenter.

• Learn the two popular and powerful on-line recruiting strategies.
• Get a list of questions to ask on-line candidates before bringing them in for an interview.
• Discover how to customize those questions to target your needs.
• Find out what you need to include in an on-line advertisement to make it effective.
• Learn to leverage social media networks to target high-quality job candidates.
• Find out points to keep in mind that could help you minimize legal problems during the recruiting process.
• Discover the policies and procedures you need in place to help your employees understand and avoid those legal issues.

Visit MyHRSupportCenter regularly not only for our HRCasts, but also to get late-breaking compliance alerts, best practices to implement, and HR tools to use every day. If you’re not yet signed up or would like a free trial of MyHRSupportCenter, contact Vision Payroll today.

In IR-2009-094, the Internal Revenue Service (IRS) announced that for 2010 the compensation limitation will remain at $245,000 under §401(a)(17), §404(l), §408(k)(3)(C), and §408(k)(6)(D)(ii) of the Internal Revenue Code of 1986 (IRC). The contribution limit under IRC §415(c)(1)(A) for defined contribution plans also remained at $49,000. This limit does not include the age 50 and over catch-up contribution of $5,500 when applicable; therefore the total limitation for eligible taxpayers age 50 or over in qualifying plans is $54,500. Contact Vision Payroll if you have questions on changes to the 2010 Retirement Plan Contribution and Compensation Limitations or get further information at Important Facts and Figures.

The Social Security Administration announced recently that the Maximum Taxable Earnings or Social Security Wage Base would not change for 2010. Since there was no increase in the Consumer Price Index (CPI-W) from the third quarter of 2008 to the third quarter of 2009, the Social Security Wage Base will remain at $106,800. There is no provision for a Cost-of-Living Adjustment (COLA) when there is no increase in the CPI-W. Wages are taxed at 6.2%, so the maximum tax to be paid by each employee will be $6,621.60. About 7% of workers who pay Social Security Tax are expected to reach the maximum in 2010.

For workers under full retirement age, $1 in benefits will be withheld for every $2 above the Retirement Earnings Test Exempt Amount of $14,160 per year or $1,180 per month. The year an individual reaches full retirement age, $1 in benefits will be withheld for every $3 above the Retirement Earnings Test Exempt Amount of $37,680 per year or $3,140 per month. The month an individual reaches full retirement age there is no limit on earnings. These amounts are unchanged from 2009 to 2010.

One amount that did increase for 2010 is that amount needed to earn a Social Security credit, formerly known as a quarter of coverage. In 2009, a credit is earned for every $1,090 of earnings, up to a maximum of four credits. That amount will increase to $1,120 in 2010.

Contact Vision Payroll if you have any questions on the Social Security changes for 2010 or get further information at Important Facts and Figures.

In IR-2009-094, the Internal Revenue Service (IRS) announced that for 2010 the Highly Compensated Employee Limitation under §414(q)(1)(B) of the Internal Revenue Code of 1986 will remain unchanged. Non-discrimination testing in some types of retirement plans limits the deferral rate of “highly compensated employees” (HCEs) based upon the deferral rate (ADP) of the “non-highly compensated employees”. For 2010, an HCE is anyone who was a “5-percent owner” at any time during 2009 or 2010 or anyone who received in excess of $110,000 in compensation during 2009 and, if elected by the employer, is in the top twenty percent of employees based upon compensation. The HCE limit was $100,000 for 2008 plan testing and $105,000 for 2009 plan testing. Since the law includes a look-back provision, employees who earned more than $105,000 in 2008 are generally considered HCEs for 2009 plan year testing, employees who will earn more than $110,000 in 2009 are generally considered HCEs for 2010 plan year testing, and employees who will earn more than $110,000 in 2010 are generally considered HCEs for 2011 plan year testing. Contact Vision Payroll if you have questions on changes to the HCE definition for 2009 and 2010 or get further information at Important Facts and Figures.

In IR-2009-094, the Internal Revenue Service (IRS) announced cost-of-living adjustments to the limits on SIMPLE plan contributions for 2010. The limitation for SIMPLE plans is codified in §408(p)(2)(E) of the Internal Revenue Code of 1986 (IRC). This section also requires annual adjustments as necessary to keep pace with inflation in a manner similar to that required by IRC §415 for retirement plans. Because the cost-of-living index in 2009 is lower than in 2008, there will be no increases to the amounts. For 2010, the SIMPLE plan regular limitation remains at $11,500. The age 50 and over catch-up contribution remains at $2,500 for individuals who plan to reach age 50 before the end of 2010. Contact Vision Payroll if you have questions on the SIMPLE plan contribution limits or get further information at Important Facts and Figures.

This week’s question comes from Kevin, a sole proprietor. I am forming an LLC and will be converting from a sole proprietorship to a single member LLC, but still taxed as a sole proprietor. Do I need a separate EIN for my single member LLC? Answer: As explained earlier, in TD 9356, the IRS announced that single member LLCs would be treated as corporations for employment tax purposes, but that the single member would still be treated as self-employed and not an employee of the LLC. Therefore, sole proprietors forming an LLC should apply for and obtain a new Employer Identification Number (EIN) using Form SS-4, Application for Employer Identification Number. Contact Vision Payroll if you have any further questions on single member LLCs.

According to the US Department of Labor, in the week ending October 10, the advance figure for seasonally adjusted initial claims was 514,000, a decrease of 10,000 from the previous week’s revised figure of 524,000. The 4-week moving average was 531,500, a decrease of 9,000 from the previous week’s revised average of 540,500.

The advance seasonally adjusted insured unemployment rate was 4.5% for the week ending October 3, a decrease of 0.1 percentage points from the prior week’s revised rate of 4.6 percent.

The advance number for seasonally adjusted insured unemployment during the week ending October 3 was 5,992,000, a decrease of 75,000 from the preceding week’s revised level of 6,067,000. The 4-week moving average was 6,082,750, a decrease of 68,250 from the preceding week’s revised average of 6,151,000.

For new employees, a smooth and efficient transition to the company can reap rewards for years to come. When it’s time to hire your next new employee, our Hiring Quick Guide will help you institute effective practices and systems for your hiring process. Learn the five top tips for managing the hiring process and download a checklist to help you manage the flow from MyHRSupportCenter. In addition to these helpful tools, the Quick Guide also contains sections with forms, templates and guidelines, relevant articles, and relevant information.

To learn more be sure to login to MyHRSupportCenter, click Quick Guides, then Hiring. If you’re not yet signed up or would like a free trial of MyHRSupportCenter, contact Vision Payroll today.

Director Gary W. Child of the Wyoming Department of Employment has announced an increase in the taxable wage base for 2010. The wage base will increase from $21,500 for 2009 to $22,800 for 2010. Contact Vision Payroll if you have any questions on Wyoming unemployment taxable wage base or visit our Unemployment Taxable Wage Base page.

Administrator Roy Mulvaney of the Montana Department of Labor and Industry has announced a 4% increase in the taxable wage base for 2010. The wage base will increase from $25,100 for 2009 to $26,000 for 2010. Contact Vision Payroll if you have any questions on Montana unemployment taxable wage base or visit our Unemployment Taxable Wage Base page.