Vision Payroll

This week’s question comes from Jennifer, an office manager. One of the users in our company tried to login using the new multi-factor authentication and received an error message. Why did an employee receive an error message trying to logon to VisionPayroll.com? Answer: Error messages are generated for a variety of situations. Below is a list of error codes that explain the errors and the steps needed to resolve them:

Error Code/Message	Description	Resolution
600	Inactive User	Instruct employee to click on “Create an account now” to set up a login.
610	Locked Out User	Payroll Administrator should reset lock out and employee can then change forgotten password by using the Forgot Password link.
620	User Access Denied	Payroll Administrator should contact Vision Payroll.
700	User locked out for failing to answer Challenge Questions correctly	Payroll Administrator should contact Vision Payroll.
800	User locked out for failing to correctly enter password	Payroll Administrator should reset lock out and employee can then change forgotten password by using the Forgot Password link.
900	User Not Found	Instruct employee to click on “Create an account now” to set up a login.
910	Inactive User	Instruct employee to click on “Create an account now” to set up a login.
920	Locked Out User	Payroll Administrator should reset lock out and employee can then change forgotten password by using the Forgot Password link.
eFraud Network Match	eFraud Network Match	Payroll Administrator should contact Vision Payroll.

Contact Vision Payroll for Further Assistance with Logon Errors

Contact Vision Payroll if you cannot resolve your errors using the above table.

According to the US Department of Labor, in the week ending February 12, the advance figure for seasonally adjusted initial claims was 410,000, an increase of 25,000 from the previous week’s revised figure of 385,000. The 4-week moving average was 417,750, an increase of 1,750 from the previous week’s revised average of 416,000.

Advance Seasonally Adjusted Insured Unemployment Rate Remains Unchanged

The advance seasonally adjusted insured unemployment rate was 3.1% for the week ending February 5, unchanged from the prior week’s unrevised rate of 3.1%.

Advance Seasonally Adjusted Insured Unemployment Decreases

The advance number for seasonally adjusted insured unemployment during the week ending February 5 was 3,911,000, an increase of 1,000 from the preceding week’s revised level of 3,910,000. The 4-week moving average was 3,941,500, an increase of 3,500 from the preceding week’s revised average of 3,938,000.

Effective February 17, 2011, Vision Payroll will partner with RSA, the Security Division of EMC, to bring multi-factor authentication to its Online Employer portal.

Authenticated Device Will Be Required to Sign-on

In addition to a username and password, users will now also be required to confirm an authentication image and phrase in order to sign-on.

Enrollment Is a Four-Step Process

Users will be required to complete a four-step enrollment process the first time signing on after multi-factor authentication is implemented. The four required steps are:

1. Select a personal image and message.
2. Select and answer secret questions.
3. Review account information.
4. Review enrollment data and submit.

Contact Vision Payroll for Assistance

Contact Vision Payroll if you need assistance with multi-factor authentication.

Washington Governor Christine Gregoire recently signed Engrossed House Bill 1091 and Senate Bill 5135 into law. As a result, most employers will have their rates reduced from the already announced 2011 employer tax rates.

Washington Employment Security Department Releases Fact Sheet

According to a fact sheet released by the Washington Employment Security Department (ESD):

Tax rates for 2011 will be reduced for 90 percent of Washington employers. In fact, about half of them will pay lower rates than in 2010. The reduction will save employers $300 million in 2011, with a total savings of about $360 million from 2011 through 2017.

Going into 2011, unemployment tax rates were projected to increase by an average of 36 percent due to widespread layoffs during the recession. Even employers with few or no layoffs faced high increases because the shared (social) costs of the insurance system had increased substantially. Meanwhile, Washington’s unemployment trust fund has remained among the healthiest in the country. This provided a unique opportunity to provide tax relief to employers without jeopardizing the benefits fund.

The new law caps the social-cost component of the unemployment tax and lowers the multipliers that set the social-cost tax rate for rate classes 1-20 (rate classes 21-40 were unchanged). [ESD] will send revised tax-rate notices to affected businesses in March.

Vision Payroll Will Use Revised Rates in First Quarter Returns

Once issued by the ESD, Vision Payroll will adjust the rates for its clients in Washington to reflect the revised rates.

Due to the increase in the Illinois individual income tax rate from 3% to 5%, the Illinois Department of Revenue has released an updated Booklet IL-700-T, Illinois Withholding Tax Tables.

New Rate Effective January 1, 2011

Because the increase is retroactive to January 1, 2011, the new rate applies immediately to the following types of income:

• Employee compensation (i.e., wages and salaries) paid in Illinois,
• Unemployment paid to an Illinois resident who has asked to have Illinois taxes withheld, and
• Gambling or lottery winnings in Illinois paid to an Illinois resident.

Automated Payroll Method Formula

For payers who use an automated payroll method to calculate their withholdings, an updated formula is provided to calculate the revised withholding amounts.

Vision Payroll Has Implemented New Withholding Tables

Vision Payroll has already updated its tax tables and will calculate the increased Illinois income tax withholding for all remaining 2011 paychecks.

The New York Department of Labor has announced the taxable wage base for 2011. The wage base will remain at $8,500 for 2011.

Employer Rates for 2011 Announced

Employer rates will go from a low of 1.5% to a high of 9.9%. The new employer rate is 4.1% for 2011. All these rates include the 0.075% re-employment tax.

Find Out the Wage Base for All States by Visiting the Vision Payroll Unemployment Taxable Wage Base Page

Contact Vision Payroll if you have any questions on New York unemployment taxable wage base or visit our Unemployment Taxable Wage Base page.

The New Hampshire Department of Economic Security (NHDES) has announced that because of the amount of unemployment benefits having been paid out and the solvency issue with the Unemployment Trust Fund, the NHDES will continue to invoke the 1.0% surcharge to all employers for all quarters of 2011. This 1.0% surcharge is comprised of the 0.5% Emergency Power under RSA282-A:84 and the 0.5% Emergency Surcharge under RSA282-a. Negative rated employers (employers whose benefit charges exceeded tax paid) will also continue to have a 1.5% added to their tax rates in addition to the 1.0% surcharge for all quarters of 2011.

Taxable Wage Base Has Also Increased

As previously announced, the Taxable Wage Base has also increased to $12,000 effective January 1, 2011 and will be increasing to $14,000 effective January 1, 2012.

2011 New Employer Rates Set

New Employer rates for all quarters of 2011 will be 3.7% (includes 1.0% surcharge).

Contact Vision Payroll for Further Information

Contact Vision Payroll if you have further questions on New Hampshire unemployment taxes.

This week’s question comes from Myrtle, a retired bookkeeper. I thought the income tax cuts were extended, but now the federal income tax withholding on my pension has increased. Why did my withholding Increase on my pension? Answer: The Internal Revenue Service (IRS) gave a detailed answer to this question in Special Edition Tax Tip 2011-01. The answer follows:

Why Employees and Retirees May See Changes in 2011 Payments and Withholding

The Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010, enacted on December 17, 2010, included several changes impacting workers’ take-home pay and retirees’ net pension checks for 2011. The Tax Relief Act extended for two years the income tax rates that were scheduled to expire at the end of 2010; that extension prevented a large increase in federal income tax withholding.

However, the new law did not extend the Making Work Pay (MWP) credit that had been available for tax years 2009 and 2010. While most workers qualified for the maximum MWP credit, pension recipients did not qualify for any MWP credit unless they also had wages or other earned income.

In December 2010, the IRS published new federal income tax withholding information to reflect the impact of the Tax Relief Act. The fact that the MWP credit expired, by itself, would have resulted in increased withholding for most taxpayers. However, under the Tax Relief Act, withholding for social security tax for all wage earners was reduced from 6.2% to 4.2% (withholding for Medicare, at 1.45%, did not change). For most employees, the net effect of these two changes will result in less total tax being withheld from their checks. The social security tax reduction does not affect pension payments.

Due to the late enactment of these tax law changes, the IRS asked employers and plan administrators to adjust their systems as soon as possible but not later than January 31, 2011. This means employees and pension recipients may not have seen the full impact of these changes until their first paycheck in February, 2011.

Once employers implement the changes, there will be a net increase in take-home pay for most employees (excluding the impact of any other withholding amounts, such as withholding for health insurance, state income taxes, etc.).

Once pension plan administrators implement the 2011 changes, the retirement check payments for some pensioners may be lower depending upon the method that their plan administrators used to calculate withholding in 2010. Because the MWP credit did not apply to pensioners, the IRS published a table for 2009 and 2010 giving plan administrators the option of increasing withholding for their pension recipients. Not all plan administrators made the optional adjustment and instead allowed pensioners to make the adjustment when they filed their tax returns. Since the 2011 withholding tables do not reflect the expired credit, pension recipients in this situation are likely to see the withholding for their 2011 pension payments increase by approximately $7 to $50 per payment, depending on filing status, the amount of the payment, and how often the payment is made.

IRS encourages both employees and pensioners to review their withholding every year using the withholding calculator on IRS.gov and, if necessary, fill out a new W-4 or W-4P form and give it to their employer or pension plan administrator.

Contact Vision Payroll for Further Information

Contact Vision Payroll if you have any further questions on the changes in federal withholding.

According to the US Department of Labor, in the week ending February 5, the advance figure for seasonally adjusted initial claims was 383,000, a decrease of 36,000 from the previous week’s revised figure of 419,000. The 4-week moving average was 415,500, a decrease of 16,000 from the previous week’s revised average of 431,500.

Advance Seasonally Adjusted Insured Unemployment Rate Remains Unchanged

The advance seasonally adjusted insured unemployment rate was 3.1% for the week ending January 29, unchanged from the prior week’s unrevised rate of 3.1%.

Advance Seasonally Adjusted Insured Unemployment Decreases

The advance number for seasonally adjusted insured unemployment during the week ending January 29 was 3,888,000, a decrease of 47,000 from the preceding week’s revised level of 3,935,000. The 4-week moving average was 3,932,250, an increase of 250 from the preceding week’s revised average of 3,932,000.

The 2011 Form W-4, Employee’s Withholding Allowance Certificate was released last month. The Spanish equivalent, 2011 Formulario W-4(SP), Certificado de Exención de la Retención del Empleado, is now available.

February 16, 2011 Is Filing Deadline

Employees claiming exempt status must file 2011 Form W-4 or 2011 Formulario W-4(SP) with their employer by February 16, 2011 to continue to claim exempt status. Prior-year forms will no longer be valid as of that date. If an employee has not filed a 2011 form by February 16, 2011, the employer must start withholding income tax with the next paycheck.

Contact Vision Payroll for Further Information

Contact Vision Payroll if you have any further questions on 2011 Formulario W-4(SP).