Vision Payroll

The Washington Employment Security Department has announced an increase in the taxable wage base for 2012. The wage base will increase from $37,300 for 2011 to $38,200 for 2012.

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

The Massachusetts Department of Revenue (DOR) has released Technical Information Release (TIR) 11-5, Employer-Provided Health Care Benefits Update. This TIR updates TIR 07-16, Personal Income Tax Treatment of Employer-Provided Health Insurance Coverage for an Employee’s Child, to reflect a Massachusetts statutory change to the personal income tax enacted in response to the federal Patient Protection and Affordable Care Act. The general effect of the Massachusetts change is to conform to the federal income exclusion rules for health care benefits that are in effect for each year, notwithstanding the general Massachusetts tie-in to federal income and exclusion rules as of January 1, 2005. The Massachusetts change is effective for tax years beginning on or after January 1, 2010.

Massachusetts Law Generally Conforms To 2005 IRC

In general, Massachusetts individual taxpayers must follow the Internal Revenue Code (IRC) in effect as of January 1, 2005. As a result of a recent law change in Massachusetts, taxpayers now follow the federal law for IRC §105 and §106 for exclusions from gross income for employer-provided health care benefits. This change is retroactive to January 1, 2010.

Amended Form W-2 May Be Required

Employers who imputed income for amounts that are now excluded from income may need to file Form W-2C, Corrected Wage and Tax Statement. Such a filing would be required if any 2010 or 2011 Forms W-2 have been provided to employees with such imputed income included. If a 2011 Form W-2 has not already been provided to affected employees, employers can simply adjust the 2011 Form W-2 when prepared. Employees who have already filed a 2010 Form 1, Massachusetts Resident Income Tax would need to file an amended return to reflect the Form W-2C. Employees who have yet to file can simply incorporate the Form W-2C figures into their return when they file.

Contact Vision Payroll for Assistance with Form W-2C

Contact Vision Payroll today if you have affected employees and need to file Form W-2C.

This week’s question comes from David, an HR Director. One of our department managers received a complaint from an employee that we need to investigate. How do we conduct workplace investigations? Answer: The Workplace Investigations Guide can help employers through an investigation based on a complaint from an employee or even a customer.

Prompt Investigation and Corrective Action Are Critical

Prompt investigation and appropriate corrective action may be necessary for situations such as:

• An employee or non-employee complains to a manager about alleged harassment or discrimination personally experienced or observed by the individual.
• A manager directly observes employee conduct which violates certain company policies.
• An employer receives a formal EEOC charge even if no employee complaint was made to management prior to the charge.

How the Workplace Investigations Guide Can Help

The Workplace Investigations Guide not only provides general guidelines to follow, it provides useful tips in the following areas:

• Interviewing the Complainant
• Interviewing the Accused
• Interviewing the Witnesses

Download the Workplace Investigations Guide Now

The Workplace Investigations Guide can be downloaded from the Forms area in the “Essentials” tab section of the MyHRSupportCenter. If you’re not yet signed up or would like a free trial of MyHRSupportCenter, contact Vision Payroll today.

According to the US Department of Labor, in the week ending June 25, the advance figure for seasonally adjusted initial claims was 428,000, a decrease of 1,000 from the previous week’s unrevised figure of 429,000. The 4-week moving average was 426,750, an increase of 500 from the previous week’s unrevised average of 426,250.

Advance Seasonally Adjusted Insured Unemployment Rate Remains Unchanged

The advance seasonally adjusted insured unemployment rate was 2.9% for the week ending June 18, a decrease of 0.1 percentage points 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 June 18 was 3,702,000, a decrease of 12,000 from the preceding week’s revised level of 3,714,000. The 4-week moving average was 3,703,500, a decrease of 11,250 from the preceding week’s revised average of 3,714,750.

Most employers nationwide will receive an employment tax reduction July 1, 2011 when the temporary FUTA surtax expires. The temporary surtax was enacted in 1976. The standard FUTA tax rate will decrease from 6.2% to 6.0%.

Standard Credit Rate is 5.4% for 2011

Generally, employers who pay their state unemployment tax by the due date for filing Form 940, Employer’s Annual Federal Unemployment (FUTA) Tax Return receive a credit 5.4% against their Federal Unemployment Tax Act (FUTA) tax. This credit is claimed on Form 940. Therefore, for 2011, many employers will pay an effective rate of 0.8% for wages paid from January 1, 2011 to June 30, 2011 and 0.6% for wages paid from July 1, 2011 to December 31, 2011.

FUTA Wage Base is $7,000 for 2011

The FUTA wage base for 2011 is $7,000. Since many employees have already been paid $7,000 in wages during 2011, no reduced tax will apply for those employees.

Credit Reduction Will Apply in Some States

Unless Congress changes the law, as many as thirty-eight states could be credit reduction states in 2011. Michigan would have a credit reduction of 0.9%, Indiana and South Carolina would have credit reductions of 0.6%, and all other states would have credit reductions of 0.3%. If these states are determined to be credit reduction states in November, the effective rates for the second half of 2011 would be 1.5% for Michigan employers, 1.2% for Indiana and South Carolina employers, and 0.9% for all other credit reduction state employers.

Vision Payroll Will Calculate the Appreciate FUTA Tax for All Employers

Employers in every state can contact Vision Payroll for assistance in determining their FUTA tax rate for 2011 and for assistance in filing Form 940.

The standard mileage rates for the use of automobiles beginning July 1, 2011 will be 55.5 cents per mile for business miles driven and 23.5 cents per mile driven for medical or moving purposes the Internal Revenue Service announced in Announcement 2011-40 and News Release IR-2011-69.

Both Rates Are Higher than First Six Months of 2011

The new rates are changed from 51 cents per mile for business travel and 19 cents per mile for moving and medical travel for the first six months of 2011.

Charitable Rate Remains Unchanged

The rate for miles driven in service of charitable organizations remains the same at 14 cents per mile.

Contact Vision Payroll for More Information on the Updated 2011 Mileage Rates

Contact Vision Payroll if you have any questions on the updated 2011 mileage rates or visit our Important Facts and Figures page for further information.

Monday, July 4, 2011 will be Independence Day, a federal holiday. The offices of Vision Payroll will close July 1 at 5 pm EDT and re-open Tuesday July 5. Most banks will also be closed in observance of the holiday.

Date Paid	Process Deadline
7/04/2011	6/29/2011
7/05/2011	6/30/2011
7/06/2011	7/01/2011

Payroll Dates May Be Affected by Independence Day

Payrolls dated July 4 will be paid July 1 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 July 7.

Labor Day Is Next Federal Holiday

The next federal holiday will be Monday, September 5, 2011, Labor Day. Contact Vision Payroll as soon as possible to make changes to or for questions on your processing schedule.

The Internal Revenue Service recently released Rev. Proc. 2011-32 which contained the 2012 inflation adjusted amounts for Health Savings Accounts or HSAs.

Deductions Limitation Set to Increase

The annual limitation on deductions will increase from $3,050 in 2011 to $3,100 in 2012 for those with self-only coverage. Those with family coverage will have the deduction limitation increase from $6,150 to $6,250.

High-Deductible Health Plan Minimum Deductibles Unchanged

The minimum deductibles of a high deductible health plan will see no change; they will remain at a minimum deductible of $1,200 in 2012 for self-only coverage and $2,400 for family coverage.

Annual Out-of-Pocket Limitation to Increase

The annual out-of-pocket limitation for 2012 will also increase from $5,950 in 2011 to $6,050 for those with self-only coverage; the out-of-pocket limitation for family coverage will increase from $11,900 to $12,100.

Contact Vision Payroll Today

Contact Vision Payroll if you have any questions on the updated 2012 inflation adjusted amounts for HSAs in Rev. Proc. 2011-32 or visit our Important Facts and Figures page for further information.

Monday, May 30, 2011 will be Memorial Day, a federal holiday. The offices of Vision Payroll will close Friday May 27 at 5 pm EDT and re-open Tuesday May 31. Most banks will also be closed in observance of the holiday.

Date Paid	Process Deadline
5/30/2011	5/25/2011
5/31/2011	5/25/2011
6/01/2011	5/26/2011

Payroll Dates May Be Affected by Memorial Day

Payrolls dated May 30 will be paid May 27 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 June 2.

Independence Day Is Next Federal Holiday

The next federal holiday will be Monday, July 4, 2011, celebration of Independence Day. Contact Vision Payroll as soon as possible to make changes to or for questions on your processing schedule.

Due to the damage caused by the severe storms, tornadoes, and associated flooding, in Arkansas on April 14, 2011, President Barack Obama declared the following counties a federal disaster area: Arkansas, Benton, Boone, Carroll, Chicot, Clark, Clay, Crawford, Crittenden, Cross, Dallas, Desha, Faulkner, Garland, Greene, Hot Spring, Independence, Jackson, Jefferson, Lawrence, Lee, Lincoln, Lonoke, Madison, Mississippi, Monroe Montgomery, Phillips, Poinsett, Prairie, Pulaski, Randolph, St. Francis, Saline, Washington, White and Woodruff.

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 April 13, 2011 and before May 10, 2011 as long as the deposits were made by May 9, 2011. In addition, affected taxpayers have until June 30, 2011 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 associated flooding and need further information on the relief provided by the IRS.