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Due to the recent enactment in New York of the Marriage Equality Act, The New York State Department of Taxation and Finance has updated information for same-sex married employees and their employers.

Employers Should Not Withhold on Certain Benefits

New York employers of same-sex married employees should institute the following changes:

• Don’t withhold New York tax on certain benefits provided to a same-sex married employee. You don’t need to withhold tax for New York State, New York City, or Yonkers income tax purposes on the value of certain benefits (e.g., domestic partner health benefit), even though it’s subject to federal withholding. This applies if the employee’s federal taxable wages subject to withholding include the value of the benefits, and the value of these benefits wouldn’t be included in taxable wages if provided to a different-sex married spouse.
• When reporting the annual wage totals on Form NYS-45, Quarterly Combined Withholding, Wage Reporting, and Unemployment Insurance Return, Part C, column d; report the federal wages minus any amount of benefits discussed above that you don’t withhold on for New York purposes (plus any amount of any taxable 414(h) retirement contributions and any IRC 125 amounts from a New York City flexible benefits program for governmental employees).
• Continue to use the rules described in the NYS-50, Employer’s Guide to Unemployment Insurance, Wage Reporting, and Withholding Tax for reporting State and local wages on federal Form W-2, Wage and Tax Statement.

Same-Sex Employees Should Consider Filing a New Form IT-2104

Same-sex employees should consider filing a new Form IT-2104, Employee’s Withholding Allowance Certificate, if they will be changing their filing status on their 2011 New York income tax return. They should also provide proof of a legal marriage to their employer so that the employer can stop withholding New York tax on the value of benefits subject to federal withholding that wouldn’t be subject to New York withholding, (e.g., domestic partner health benefit).

Contact Vision Payroll Today

Contact Vision Payroll if you have further questions on the changes in New York to withholding on same-sex married employees.

Pursuant to legislation passed in 2010, the taxable wage base in Vermont will increase for 2012. The wage base will increase from $13,000 for 2011 to $16,000 for 2012.

Third Consecutive Annual Increase

This is the third consecutive year that the wage base will increase. In 2010, it increased from $8,000 to $10,000 and in 2011 it increased from $10,000 to $13,000.

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 the Vermont unemployment taxable wage base or visit our Unemployment Taxable Wage Base page.

How would you like to save 5% per year on your employee labor costs by doing one simple thing? The American Payroll Association estimates that “buddy punching” accounts for up to 5% of gross payroll costs each year. For a company with a yearly labor cost of $300,000, buddy punching could cost as much as $15,000.

Our New PrintReader™ Can Add Biometrics To Your Existing System

Eliminate buddy punching by adding biometrics to your already-existing time clock with our NEW PrintReader™! Now a biometric solution can be easily added to your existing timekeeping system in just a few minutes. Saving on labor costs and preventing employee time theft by eliminating buddy punching will save your company thousands in labor costs each year while improving employee productivity.

Start Your Free 30-Day Timekeeping Trail Today

Not sure if a timekeeping system is right for you? Call Vision Payroll today to get started on your free 30-day timekeeping trial. A few clicks on the internet, import your employees, and you’re ready to go. Find out how a modern, automated timekeeping system can save time and money, improve your recordkeeping, make the entire payroll process much simpler.

The state of North Carolina legislature, over the veto of Governor Beverly Perdue, enacted Senate Bill (SB) 532, “An Act to Reform the Employment Security Laws of North Carolina by Creating the Division of Employment Security Within the Department of Commerce, Transferring the Functions of the Employment Security Commission to that Division, Making the Division Subject to Rule Making Under Article 2A of Chapter 150B of the General Statutes, and by Making Other Modifications and Conforming Changes to Align the Employment Security Functions of State Government Under the Direct Leadership of The Secretary of Commerce.”

Governor Purdue Comments on Her Veto of SB 532

Governor Perdue issued the following statement in conjunction with her veto of SB 532:

In Executive Order No. 85, I called for the transfer of the Employment Security Commission to the Department of Commerce for administrative purposes as a way to streamline State government. The General Assembly agreed with this idea by placing a provision in its budget bill directing that such a transfer take place. However, SB 532 goes far beyond an administrative transfer and proceeds to radically change the way that unemployment benefits are administered in this State — doing so in a way that calls into question the fairness of the entire process. As a result of these drastic changes, we have been informed by the United States Department of Labor (DOL) that any finding of a lack of conformity between this bill and federal law will result in North Carolina’s loss of money for its unemployment insurance program and that this bill will also raise taxes on all employers statewide who pay federal unemployment taxes. I cannot allow a bill to become law that will endanger our receipt of these much-needed federal funds for our unemployed citizens. Nor am I willing to approve this increased tax on our State’s employers.

House Speaker Thom Tillis Responded to Governor Perdue’s Veto

House Speaker Thom Tillis (R-Mecklenburg) released the following statement concerning the veto override of SB 532:

SB 532 originally passed the House with 104 votes, and I am pleased it was passed into law today. This bill streamlines the agency responsible for employment security in North Carolina, and brings more efficiency to the administration of unemployment benefits. It makes the system fairer for employers and unemployed citizens, while reforming portions of a system that has been plagued by fiscal mismanagement. This bill does not raise taxes; in fact, it is one of a series of steps necessary to eventually reduce the unemployment tax penalties paid by the employers. Finally, the ESC and the Governor still have the power to address any concerns by the DOL. This is a pro-business piece of legislation that provides much-needed clarity for businesses and their employees when facing the prospect of unemployment.

Impact of SB 532 on North Carolina Unemployment Law

The significant provisions of SB 532 include the following:

• Creation of a new Division of Employment Security within the Department of Commerce,
• Extension of the time allowed an employer from ten days to thirty days from mailing or delivery of the notice of claim filed to protest the claim,
• Expansion of the term “misconduct connected with work” to include termination or suspension “from employment after arrest or conviction for an offense involving violence, sex crimes, or illegal drugs,”
• Imposition of a total disqualification of benefits for “the failure to adequately perform any other employment duties as evidenced by no fewer than three written reprimands received in the 12 months immediately preceding the employee’s termination,” and

Contact Vision Payroll Today

Contact Vision Payroll if you have further questions of the impact of SB 532 on North Carolina unemployment law.

This week’s question comes from Eileen, an office manager. I read that one of the tests for an expense to qualify for reimbursement by a dependent care flexible spending arrangement (FSA) is that the care must be for one or more qualifying persons. What is a qualifying person for a dependent care FSA reimbursement? Answer: A person is a qualifying person if the person meets one of three tests.

Qualifying Person Test

A qualifying person for 2011 is:

• Your qualifying child who is your dependent and who was under age 13 when the care was provided.
• Your spouse who was not physically or mentally able to care for himself or herself and lived with you for more than half the year, or
• A person who was not physically or mentally able to care for himself or herself, lived with you for more than half the year, and either:
  • Was your dependent, or
  • Would have been your dependent except that:
    • He or she received gross income of $3,700 or more,
    • He or she filed a joint return, or
    • You, or your spouse if filing jointly, could be claimed as a dependent on someone else’s 2011 return.

Exceptions Apply To General Rules

The rules above are generally applicable, but there are exceptions for certain situations such as children of divorced parents, care in the year or birth or death, adopted children, and other situations.

Contact Vision Payroll Today

Contact Vision Payroll for further information on the qualifying person test for reimbursement by a dependent care FSA.

According to the US Department of Labor, in the week ending July 23, the advance figure for seasonally adjusted initial claims was 398,000, a decrease of 24,000 from the previous week’s revised figure of 422,000. The 4-week moving average was 413,750, a decrease of 8,500 from the previous week’s revised average of 422,250.

Advance Seasonally Adjusted Insured Unemployment Rate Decreases

The advance seasonally adjusted insured unemployment rate was 2.9% for the week ending July 16, a 0.1 percentage point decrease from the prior week’s revised rate of 3.0%.

Advance Seasonally Adjusted Insured Unemployment Decreases

The advance number for seasonally adjusted insured unemployment during the week ending July 16 was 3,703,000, a decrease of 17,000 from the preceding week’s revised level of 3,720,000. The 4-week moving average was 3,721,000, a decrease of 5,250 from the preceding week’s revised average of 3,726,250.

Employers must ensure that any adverse employment actions are completely unrelated to claims an employee might make in terms of wage and hour issues. Learn about steps to avoid disastrous wage and hour class actions.

Six Steps You Can Take Today to Minimize Your Company’s Risk

• Don’t create a situation or reason for an employee to raise a complaint.
• Ensure that unpaid lunch breaks are at least thirty minutes long.
• Don’t make improper deductions from exempt employees’ salaries.
• Self-audit your exempt and non-exempt employees for proper classification.
• Self-audit your independent contractors to ensure they’re not employees.
• Provide wage and hour training for all supervisors and managers.

Get More Details on Wage and Hour Retaliation Claims

To learn more details about each of these preventive measures, be sure to listen to How to Protect Against Wage and Hour Retaliation Claims 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.

In Announcement 2011-42, Discontinuance of High-Low Method for Substantiating Travel Expenses, the Internal Revenue Service (IRS) announced its intention to discontinue authorizing the high-low substantiation method.

No Comments Received on Proposed Change

In Rev. Proc. 2010-39, 2010-42 IRB 459, the IRS requested public comment on the continuing need for the high-low method for substantiating, under §274(d) of the Internal Revenue Code, lodging, meal, and incidental expenses incurred in traveling away from home. The IRS received no comments.

New Revenue Procedure Will Provide General Rules

In 2011, the IRS plans to publish a revenue procedure providing the general rules and procedures for substantiating lodging, meal, and incidental expenses incurred in traveling away from home (omitting the high-low substantiation method).

Contact Vision Payroll Today

Contact Vision Payroll if you have any questions on the discontinuance of high-low method for substantiating travel expenses

The US Department of Labor today announced a $379,500 National Emergency Grant to provide training and employment services to about 200 workers affected by the closure of the Premier Bankcard call center in Spearfish, SD. The company announced in May that it would be closing the center and permanently laying off its workers.

DOL Secretary Solis Comments on Grant

“This grant will help dislocated workers by equipping them with the skills necessary to obtain good, stable jobs in the area’s high-growth industries,” said Secretary of Labor Hilda L. Solis.

Grant Awarded to the South Dakota Department of Labor

Awarded to the South Dakota Department of Labor, the grant will provide services that focus on supporting the needs of local industries, including health care and education.

National Emergency Grants Are Part of Discretionary Fund

National Emergency Grants are part of the secretary of labor’s discretionary fund and are awarded based on a state’s ability to meet specific guidelines.

The New Jersey Department of Labor and Workforce Development has announced the wage base for New Jersey unemployment insurance, temporary disability insurance, and family leave insurance will increase from $29,600 for 2011 to $30,300 for 2012.

2012 Rate Year Rates Increased

As previously reported, the rates for the 2012 rate year are being determined by column D. They had been determined by column C during rate year 2011.

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 the New Jersey unemployment taxable wage base or visit our Unemployment Taxable Wage Base page.