Vision Payroll

This week’s question comes from Scott, a small-business owner. I own a business in Michigan. I’ve heard that for 2009, Michigan is a credit reduction state. What is a credit reduction state? Answer: For 2009, Michigan is the only “credit reduction state”. This means that employers in Michigan are not allowed the full credit against the federal unemployment tax act (FUTA) tax. Wages paid that are subject to the unemployment compensation laws of the state of Michigan do not receive the full credit of 5.4%; a credit reduction of 0.3% applies so that such wages receive a credit of 5.1% for 2009. Employers that have wages that are subject to the unemployment compensation laws of the state of Michigan must use Schedule A of Form 940 to calculate the FUTA due. Contact Vision Payroll if you have any further questions on credit reduction states.

According to the US Department of Labor, in the week ending December 5, the advance figure for seasonally adjusted initial claims was 474,000, an increase of 17,000 from the previous week’s unrevised figure of 457,000. The 4-week moving average was 473,750, a decrease of 7,750 from the previous week’s revised average of 481,500.

The advance seasonally adjusted insured unemployment rate was 3.9% for the week ending November 28, a decrease of 0.2 percentage points from the prior week’s unrevised rate of 4.1%.

The advance number for seasonally adjusted insured unemployment during the week ending November 28 was 5,157,000, a decrease of 303,000 from the preceding week’s revised level of 5,460,000. The 4-week moving average was 5,416,500, a decrease of 123,500 from the preceding week’s revised average of 5,540,000.

The fiscal year-to-date average for seasonally adjusted insured unemployment for all programs is 5.767 million.

The holiday season brings great opportunities to celebrate – Thanksgiving, New Year’s Day, and the company holiday party! While some companies have decided to forego company-sponsored festivities due to increasing liability and costs, your company can still host a great event if you consider the following tips:

• Assess the Liability
• Communicate Casual and Careful
• Promote Policies and Practices
• Prepare the Disaster Plan
• Take the Lead

To learn more about each of these areas, be sure to read the featured article by the HR pros at MyHRSupportCenter, 5 Tips to Playing It Safe when Planning Company Events. If you’re not yet signed up or would like a free trial of MyHRSupportCenter, contact Vision Payroll today.

The Oregon Employment Department has announced an increase in the taxable wage base for 2010. The wage base will increase from $31,300 for 2009 to $32,100 for 2010. Contact Vision Payroll if you have any questions on the Oregon unemployment taxable wage base or visit our Unemployment Taxable Wage Base page.

The Oklahoma Employment Security Commission has announced an increase in the taxable wage base for 2010. The wage base will increase from $14,200 for 2009 to $14,900 for 2010. Contact Vision Payroll if you have any questions on the Oklahoma unemployment taxable wage base or visit our Unemployment Taxable Wage Base page.

According to the California Employment Development Department (EDD), employers in the county of Santa Cruz directly affected by the damage resulting from the mudslides and flooding may request up to a 60-day extension of time from EDD to file their State payroll reports and/or deposit State payroll taxes without penalty or interest. The written request for extension must be received within 60 days from the original delinquent date of the payment or return to file/pay. Contact Vision Payroll if you’ve been affected and need to file the extension request.

The unemployment rate edged down to 10.0% in November, and nonfarm payroll employment was essentially unchanged (-11,000), the US Bureau of Labor Statistics reported recently. In the prior 3 months, payroll job losses had averaged 135,000 a month. In November, employment fell in construction, manufacturing, and information, while temporary help services and health care added jobs.

In November, both the number of unemployed persons, at 15.4 million, and the unemployment rate, at 10.0%, edged down. At the start of the recession in December 2007, the number of unemployed persons was 7.5 million, and the jobless rate was 4.9%.

Among the major worker groups, unemployment rates for adult men (10.5%), adult women (7.9%), teenagers (26.7%), whites (9.3%), blacks (15.6%), and Hispanics (12.7%) showed little change in November. The unemployment rate for Asians was 7.3%, not seasonally adjusted.

Among the unemployed, the number of job losers and persons who completed temporary jobs fell by 463,000 in November. The number of long-term unemployed (those jobless for 27 weeks and over) rose by 293,000 to 5.9 million. The percentage of unemployed persons jobless for 27 weeks or more increased by 2.7 percentage points to 38.3%.

The civilian labor force participation rate was little changed in November at 65.0%. The employment-population ratio was unchanged at 58.5%.

The number of people working part time for economic reasons (sometimes referred to as involuntary part-time workers) was little changed in November at 9.2 million. These individuals were working part time because their hours had been cut back or because they were unable to find a full-time job.

About 2.3 million persons were marginally attached to the labor force in November, an increase of 376,000 from a year earlier. (The data are not seasonally adjusted.) These individuals were not in the labor force, wanted and were available for work, and had looked for a job sometime in the prior 12 months. They were not counted as unemployed because they had not searched for work in the 4 weeks preceding the survey.

Among the marginally attached, there were 861,000 discouraged workers in November, up from 608,000 a year earlier. (The data are not seasonally adjusted.) Discouraged workers are persons not currently looking for work because they believe no jobs are available for them. The remaining 1.5 million persons marginally attached to the labor force had not searched for work in the 4 weeks preceding the survey for reasons such as school attendance or family responsibilities.

This week’s question comes from Shawn, an HR director. We have several employees claiming exemption from federal withholding. Do employees claiming exemption from withholding need to file a new Form W-4 for 2010? Answer: Employees who have provided a Form W-4, Employee’s Withholding Allowance Certificate claiming exemption from federal income tax withholding must file a new 2010 Form W-4 by February 16, 2010 in order to continue their exemption from federal income tax withholding. Employers must start withholding on February 16, 2010 if employees have not provided a 2010 Form W-4 claiming exemption. Even employees who are no longer claiming exemption should file a 2010 Form W-4 so that employers may calculate the proper amount of withholding. If an employee has not provided a 2010 Form W-4 by February 16, 2010, the employer should withhold based on a previously filed Form W-4 not claiming exemption, if available or using single, zero allowances, if not. Spanish-speaking employees may complete Formulario W-4(SP), Certificado de Exención de la Retención del Empleado. Upon request, Vision Payroll can provide employers with pre-printed 2010 Forms W-4 for all active employees. Vision Payroll will not automatically change any employee’s claimed withholding allowances. Employers should update the allowances claimed by logging in to their company file or providing Vision Payroll with the updated information.

According to the US Department of Labor, in the week ending November 28, the advance figure for seasonally adjusted initial claims was 457,000, a decrease of 5,000 from the previous week’s revised figure of 462,000. The 4-week moving average was 481,250, a decrease of 14,250 from the previous week’s revised average of 495,500.

The advance seasonally adjusted insured unemployment rate was 4.1% for the week ending November 21, unchanged from the prior week’s unrevised rate of 4.1%.

The advance number for seasonally adjusted insured unemployment during the week ending November 21 was 5,465,000, an increase of 28,000 from the preceding week’s revised level of 5,437,000. The 4-week moving average was 5,541,500, a decrease of 75,750 from the preceding week’s revised average of 5,617,250.

The fiscal year-to-date average for seasonally adjusted insured unemployment for all programs is 5.832 million.

The standard mileage rates for the use of automobiles beginning January 1, 2010 will be 50 cents per mile for business miles driven and 16.5 cents per mile driven for medical or moving purposes the Internal Revenue Service announced in Revenue Procedure 2009-54 and News Release IR-2009-111. The new rates are changed from 55 cents per mile for business travel, 24 cents per mile for moving and medical travel for 2009. The rate for miles driven in service of charitable organizations has remained the same at 14 cents per mile. Contact Vision Payroll if you have any questions on 2010 mileage rates.