Vision Payroll

In IR-2010-108, the Internal Revenue Service (IRS) announced the limits on deferral contributions for 2011 under §401(k), §403(b), and §457(e)(15). These limitations are codified in those sections of the Internal Revenue Code of 1986 (IRC). Under IRC §415, the Commissioner of the IRS is required to adjust the plan limitations to keep pace with inflation.

2011 Contribution Limits Remains Unchanged

For 2011, the deferral contribution limitation will remain at $16,500. The age 50 and over catch-up contribution will remain at $5,500 for 2011 for individuals who plan to reach age 50 before the end of 2011.

Contact Vision Payroll for More Information on 2011 Retirement Plan Changes

Contact Vision Payroll if you have questions on changes to the 2011 Retirement Plan Contribution and Compensation Limitations or get further information at Important Facts and Figures.

In IR-2010-108, the Internal Revenue Service (IRS) announced that for 2011 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).

2011 Contribution Limit Also Remains Unchanged

The contribution limit under IRC §415(c)(1)(A) for defined contribution plans will remain 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 will be $54,500.

Contact Vision Payroll for More Information on 2011 Retirement Plan Changes

Contact Vision Payroll if you have questions on changes to the 2011 Retirement Plan Contribution and Compensation Limitations or get further information at Important Facts and Figures.

This week’s question comes from Cristina, a company president. We’re doing some planning for next year. What are the 2011 Highly Compensated Employee Limits?

IRS Releases 2011 Highly Compensated Employee Limits in IR-2010-108

In IR-2010-108, the Internal Revenue Service (IRS) announced that for 2011 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”.

Highly Compensated Employee Compensation Limit Remains at $110,000

For 2011, an HCE is anyone who was a “5-percent owner” at any time during 2010 or 2011 or anyone who received in excess of $110,000 in compensation during 2010 and, if elected by the employer, is in the top twenty percent of employees based upon compensation. The HCE limit was $110,000 for 2008 and 2009.

Look-back Provision Impacts HCE Testing Period

Since the law includes a look-back provision, employees who earned more than $110,000 in 2009 are generally considered HCEs for 2010 plan year testing, employees who will earn more than $110,000 in 2010 are generally considered HCEs for 2011 plan year testing, and employees who will earn more than $110,000 in 2011 are generally considered HCEs for 2012 plan year testing.

Contact Vision Payroll for More Information on HCEs

Contact Vision Payroll if you have questions on changes to the HCE definition for 2010 and 2011 or get further information at Important Facts and Figures.

According to the US Department of Labor, in the week ending October 23, the advance figure for seasonally adjusted initial claims was 434,000, a decrease of 21,000 from the previous week’s revised figure of 455,000. The 4-week moving average was 453,250, a decrease of 5,500 from the previous week’s revised average of 458,750.

Advance Seasonally Adjusted Insured Unemployment Rate Decreases

The advance seasonally adjusted insured unemployment rate was 3.5% for the week ending October 16, a decrease of 0.1 percentage points from the prior week’s revised rate of 3.6%.

Advance Seasonally Adjusted Insured Unemployment Decreases

The advance number for seasonally adjusted insured unemployment during the week ending October 16 was 4,356,000, a decrease of 122,000 from the preceding week’s revised level of 4,478,000. The 4-week moving average was 4,447,250, a decrease of 38,500 from the preceding week’s revised average of 4,485,750.

Hiring remote workers has grown more common and can provide significant benefits for many businesses. Understanding how to manage your employees during this workforce trend is crucial in maintaining top talent and keeping your business competitive.

5 Tips on Working with Remote Workers

1. Get the right workers for remote work
2. Communicate clear expectations
3. Review for relevant policies
4. Leveraging technology for performance
5. Meet regularly and frequently

Implement These Tips for Your Remote Workers

To learn details on how to implement these tips in your workplace, be sure to listen to 5 Tips on Working with Remote Workers in this month’s HRCast, a recording provided by our team of HR Pros and available exclusively on MyHRSupportCenter.

MyHRSupportCenter Provides Alerts, Best Practices, and HR Tools Every Day

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 haven’t yet signed up and would like a free trial of MyHRSupportCenter, contact Vision Payroll today.

According to the California Employment Development Department (EDD), employers in the county of Placer directly affected by the Roseville fire 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. This extension may be granted under Section 1111.5 of the California Unemployment Insurance Code (CUIC).

Placer County in a Declared State of Emergency Due to Roseville Fire

Written request for extension must be received within 60 days from the original delinquent date of the payment or return to file/pay.

Vision Payroll Can Assist Placer County Clients with Extension Application

Contact Vision Payroll if you’ve been affected and need to file the extension request.

Thursday, November 11, 2010 will be Veterans Day, a federal holiday. Although the offices of Vision Payroll will be open and payrolls will be processed, most banks will be closed in observance of the holiday.

Date Paid	Process Deadline
11/11/2010	11/8/2010
11/12/2010	11/9/2010
11/15/2010	11/10/2010

Payroll Dates May Be Affected by Veterans Day

Payrolls dated November 11 will be paid November 10 unless a previous change in schedule has been submitted. Payrolls submitted after these processing deadlines will be pushed back until the next available processing day. No changes are required for payrolls dated November 16.

Thanksgiving Day Is Next Federal Holiday

The next federal holiday will be Thursday, November 24, 2010, Thanksgiving Day. Contact Vision Payroll as soon as possible to make changes to or for questions on your processing schedule.

The Labor Department of the Arizona Industrial Commission announced recently that pursuant to Arizona Revised Statutes §23-363, the minimum wage for the state of Arizona will increase to $7.35 per hour effective January 1, 2011. The law requires an adjustment to the minimum wage be calculated each year.

Adjustment Is Tied to Changes in CPI

The adjustment is tied to the US All-Urban Consumer Price Index (CPI) for the 12 months ending in August. The 1.1% increase in the CPI will result in an increase of $0.10 for 2011.

Find Out the Minimum Wage for All States by Visiting the Vision Payroll Minimum Wage Chart Page

Contact Vision Payroll if you have any questions on the Arizona minimum wage increase or visit our Minimum Wage Chart.

Due to the damage caused by the severe storms, flooding, and straight-line winds in North Carolina on September 27, 2010, President Barack Obama declared the following counties a federal disaster area: Beaufort, Bertie, Brunswick, Craven, Hertford, Jones, Pender, Pitt, Onslow and Tyrrell.

Declaration Leads to Extension of Payroll Tax and Other Deadlines

Therefore, the Internal Revenue Service (IRS) announced recently that it will waive failure to deposit penalties for employment and excise taxes due after September 26, 2010 and before October 13, 2010 as long as the deposits were made by October 12, 2010. In addition, affected taxpayers had until November 26, 2010 to file most tax returns.

Vision Payroll is Here to Help Affected Taxpayers with Payroll Tax Issues

Contact Vision Payroll if you were affected by the severe storms, flooding, and straight-line winds and need further information on the relief provided by the IRS.

This week’s question comes from Anne, a company president. We just received a Notice of Change in Filing Frequency from the Massachusetts Department of Revenue (DOR). What is a Notice of Change in Filing Frequency? Answer: In Massachusetts, employers are required to deposit payroll taxes on one of four filing frequencies:

• Depository
• Monthly
• Quarterly
• Annual

Frequencies Are Based upon Taxes Paid

These frequencies are based upon the amount of tax paid in a twelve-month period. For payroll taxes, the amounts are as follows:

• Depository is greater than $25,000
• Monthly is between $1,200 and $25,000
• Quarterly is between $100 and $2,500
• Annual is less than $100

Consequently, when the amount an employer is expected to pay passes one of the thresholds, the DOR will change the filing frequency.

DOR Mails Notices to Affected Employers

Each year, the DOR mails notices to employers whose frequency will change for the next calendar year. This notice is called a Notice of Change in Filing Frequency.

Forward Notices to Vision Payroll

Although Vision Payroll will review each client’s filing frequency in January, employers who receive a notice can send a copy to Vision Payroll if they wish to have their filing status change on file.