Vision Payroll

Wednesday, January 1, 2014 will be New Year’s Day, a federal holiday. The offices of Vision Payroll will close New Year’s Eve, Tuesday December 31 at 3 pm EST and re-open Thursday January 2. Most banks will also be closed in observance of the holiday. Payroll changes and hours must be submitted before the processing deadlines as listed below.

Normal Payroll Date	Process Deadline
1/1/2014	12/27/2013
1/2/2014	12/30/2013
1/3/2014	12/31/2013

Payroll Dates May Be Affected by New Year’s Day

Payrolls dated January 1 will be paid December 31 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 January 6.

Bank Withdrawal Dates Will Change for Some Payrolls

For payrolls dated December 31, including those normally paid on Wednesdays, ACH withdrawals from clients’ accounts will occur on Monday, December 30. For payrolls dated January 2, ACH withdrawals from clients’ accounts will occur on Tuesday, December 31. This is necessary to ensure timely crediting of employees’ accounts on the proper day.

UPS Will Limit Deliveries and Pickups

Due to heavy USPS and UPS delivery requirements as well as limited bank hours and staffing, we strongly recommend submitting payrolls during this time as early as practicable. Ground packages received by UPS on December 31 do not ship from UPS until January 2 so we do not recommend submitting on that date any payrolls dated before January 3.

Birthday of Martin Luther King, Jr. Is Next Federal Holiday

The next federal holiday will be Monday, January 20, 2014, Birthday of Martin Luther King, Jr. Contact Vision Payroll as soon as possible to make changes to or for questions on your processing schedule.

Wednesday, December 25, 2013 will be Christmas Day, a federal holiday. The offices of Vision Payroll will close Christmas Eve, Tuesday December 24 at 2 pm EST and re-open Thursday December 26. Most banks will also be closed in observance of the holiday. Payroll changes and hours must be submitted before the processing deadlines as listed below.

Normal Payroll Date	Process Deadline
12/25/2013	12/20/2013
12/26/2013	12/23/2013
12/27/2013	12/24/2013

Payroll Dates May Be Affected by Christmas Day

Payrolls dated December 25 will be paid December 24 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 December 30.

Bank Withdrawal Dates Will Change for Some Payrolls

For payrolls dated December 24, including those normally paid on Wednesdays, ACH withdrawals from clients’ accounts will occur on Monday, December 23. For payrolls dated December 26, ACH withdrawals from clients’ accounts will occur on Tuesday, December 24. This is necessary to ensure timely crediting of employees’ accounts on the proper day.

UPS Will Limit Deliveries and Pickups

Due to heavy USPS and UPS delivery requirements as well as limited bank hours and staffing, we strongly recommend submitting payrolls during this time as early as practicable. Since the final bank processing for ACH transactions on December 24 is 1 pm EST, in order to ensure proper crediting of transactions for Thursday, December 26, we recommend submitting payrolls dated Thursday no later than 2 pm EST, Monday, December 23. Ground packages received by UPS on December 24 do not ship from UPS until December 26 so we do not recommend submitting on that date any payrolls dated before December 27.

New Year’s Day Is Next Federal Holiday

The next federal holiday will be Wednesday, January 1, 2014, New Year’s Day. Contact Vision Payroll as soon as possible to make changes to or for questions on your processing schedule.

 

Effective January 1, 2014, restaurants and other employers with tipped employees must change the way certain tips are reported. Although Rev. Rul. 2012-18 took effect in 2012, examiners in some circumstances could apply it to amounts paid after December 31, 2013. Therefore, all employers must comply with Rev. Rul. 2012-18 starting in 2014.

Payments Traditionally Treated as Tips Must Now Be Treated as Service Charges

Certain payments that tipped employees receive and employers called tips must now be treated as wages. Since these wages are subject to withholding, they should be paid in the employee’s paycheck. Although there is a line on Form 941, Employer’s QUARTERLY Federal Tax Return, to report the uncollected employee share of social security and Medicare taxes on tips, there is no line to report such uncollected taxes on wages or service charges treated as wages. In order to collect and pay these taxes, therefore, the service charges should be paid on the employee’s paycheck.

Employer’s Characterization of Amounts as Tips Is Not Relevant

The Internal Revenue Service (IRS) states that it is irrelevant whether or not the payment is called a tip. According to the IRS, “the absence of any of the following factors creates a doubt as to whether a payment is a tip and indicates that the payment may be a service charge.” The four factors listed are the following:

1. The payment must be made free from compulsion;
2. The customer must have the unrestricted right to determine the amount;
3. The payment should not be the subject of negotiation or dictated by employer policy; and
4. Generally, the customer has the right to determine who receives the payment.

Mandated Tips and Suggested Tips

Examples provided by the IRS distinguish between mandated tips and “suggested” tips. In the former case, the menu dictates that an 18% gratuity will be added for parties of six or more. Since the amount is added to the charged amount by the employer and the customer did not have the unrestricted right to determine the amount, this payment is considered wages, not tips. Alternatively, if the check simply shows sample tips amounts of 15%, 18%, and 20% and the customer chooses one of the suggested tip amounts, the amount is still considered a tip for payroll tax purposes.

Service Charges Should Not Be Reported as Tips

Employees are generally required to report cash tips (including amounts paid on credit cards and received in a tip-sharing arrangement) to their employers, and those cash tips are included in gross income of the employees. Amounts determined to be wages and not tips under these provisions should not be included in the amounts reported to employers.

Contact Vision Payroll if You Have Questions on the New Rules on Tips

Be sure to contact Vision Payroll if you have further questions on Rev. Rul. 2012-18 and the new rules on tip reporting.

Thursday, November 28, 2013 will be Thanksgiving Day, a federal holiday. The offices of Vision Payroll will close Thanksgiving Eve, November 27 at 3 pm EST and re-open Friday November 29. Most banks will also be closed in observance of the holiday. Payroll changes and hours must be submitted before the processing deadlines listed below:

Normal Payroll Date	Process Deadline
11/28/2013	11/25/2013
11/29/2013	11/26/2013
12/02/2013	11/27/2013

Payroll Dates May Be Affected by Thanksgiving Day

Payrolls dated November 28 will be paid November 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 December 3.

Christmas Day Is Next Federal Holiday

There will be no UPS ground delivery on November 28 or November 29, so we strongly recommend submitting payrolls during this time as early as practicable. The next federal holiday will be Wednesday, December 25, 2013, Christmas Day. Contact Vision Payroll as soon as possible to make changes to or for questions on your processing schedule.

The Social Security Administration announced today that the Maximum Taxable Earnings or Social Security Wage Base would increase from $113,700 in 2013 to $117,000 in 2014.

Social Security Increases Based on CPI Change

Since there was a 1.5% increase in the Consumer Price Index (CPI-W) from the third quarter of 2012 to the third quarter of 2013, the Social Security Administration announced a 1.5% cost-of-living adjustment for 2014. This compares to a 1.7% increase in 2013. The wage base increase is based on an increase in the national average wage index. Wages are taxed at 6.2%, so the maximum tax to be paid by each employee at that rate would be $7,254.00. About 6% of workers who pay Social Security Tax are expected to reach the maximum in 2014.

Retirement Earnings Test Exempt Amounts Increase for 2014

For workers under full retirement age who are receiving Social Security benefits, $1 in benefits is withheld for every $2 above the Retirement Earnings Test Exempt Amount of $15,120 per year or $1,260 per month in 2013. This will increase to $15,480 per year or $1,290 per month for 2014. The year an individual reaches full retirement age, $1 in benefits is withheld for every $3 above the Retirement Earnings Test Exempt Amount of $40,080 per year or $3,340 per month in 2013. This will increase to $41,400 per year or $3,450 per month for 2014. The month an individual reaches full retirement age there is no limit on earnings.

Quarter of Coverage Amounts Increases to $1,160

Also increasing for 2014 is that amount needed to earn a Social Security credit, formerly known as a quarter of coverage. In 2013, a credit is earned for every $1,160 of earnings, up to a maximum of four credits. That amount will increase to $1,200 for 2014.

Social Security Monthly Benefits to Increase in January 2014

The maximum benefit for a worker retiring at full retirement age is also increasing from $2,533 to $2,642. See the table below for other changes in Social Security benefits for 2014.

2014 Social Security Benefits

	2013	2014
Maximum Benefit:
Worker Retiring at Full Retirement Age	$2,533 per month	$2,642 per month
SSI Federal Payment Standard:
Individual	$710 per month	$721 per month
Couple	$1,066 per month	$1,082 per month
SSI Resources Limit:
Individual	$2,000	$2,000
Couple	$3,000	$3,000
SSI Student Exclusion:
Monthly Limit	$1,730	$1,750
Annual Limit	$6,960	$7,060

Contact Vision Payroll Today

Contact Vision Payroll if you have any questions on the Social Security changes for 2014 or get further information at Important Facts and Figures.

Monday, November 11, 2013 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.

Normal Payroll Date	Process Deadline
11/11/2013	11/6/2013
11/12/2013	11/7/2013
11/13/2013	11/8/2013

Payroll Dates May Be Affected by Veterans Day

Payrolls dated November 11 will be paid November 8 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 14.

Thanksgiving Day Is Next Federal Holiday

The next federal holiday will be Thursday, November 28, 2013, Thanksgiving Day. Contact Vision Payroll as soon as possible to make changes to or for questions on your processing schedule.

Monday, October 14, 2013 will be Columbus 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
10/14/2013	10/9/2013
10/15/2013	10/10/2013
10/16/2013	10/11/2013

Payroll Dates May Be Affected by Columbus Day

Payrolls dated October 14 will be paid October 11 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 October 17.

Veterans Day Is Next Federal Holiday

The next federal holiday will be Monday, November 11, 2013, Veterans Day. Contact Vision Payroll as soon as possible to make changes to or for questions on your processing schedule.

Under the Patient Protection and Affordable Care Act, also known as the Affordable Care Act Under the Patient Protection and Affordable Care Act, also known as the Affordable Care Act or Obamacare, most employers are required to provide one of two notices to all employees. Guidance was provided to employers by the US Department of Labor (DOL) in Technical Release No. 2013-02, Guidance on the Notice to Employees of Coverage Options under Fair Labor Standards Act §18B and Updated Model Election Notice under the Consolidated Omnibus Budget Reconciliation Act of 1985.

Notice Not Required for Former Employees Who Have Elected COBRA Coverage

Although all employees, regardless of plan enrollment status or availability, must receive a notice, the DOL in Technical Release No. 2013-02 clarifies that “[e]mployers are not required to provide a separate notice to dependents or other individuals who are or may become eligible for coverage under the plan but who are not employees.” Therefore, former employees eligible for coverage need not be notified.

Contact Vision Payroll for Further Information

Contact Vision Payroll if you have further questions on the notice to employees of coverage options required under the ACA.

Under the Patient Protection and Affordable Care Act, also known as the Affordable Care Act or Obamacare, most employers are required to provide one of two notices to all employees. Guidance was provided to employers by the US Department of Labor (DOL) in Technical Release No. 2013-02, Guidance on the Notice to Employees of Coverage Options under Fair Labor Standards Act §18B and Updated Model Election Notice under the Consolidated Omnibus Budget Reconciliation Act of 1985.

Employers Required to Provide the Notice

Employers subject to the Fair Labor Standards Act (FLSA) are subject to the notice requirements. The DOL offers an online tool to help employers determine if they are subject to the FLSA. One of the criteria is that employees who are engaged in, or produce goods for, interstate commerce are subject to the FLSA.

Examples of Covered Employees Who Are Engaged in Interstate Commerce

The DOL online tool provides the following examples of employees who are engaged in interstate commerce:

• An employee such as an office or clerical worker who uses a telephone, facsimile machine, the US mail, or a computer E-mail system to communicate with persons in another state.
• An employee who drives or flies to another state.
• An employee who unloads goods which came from an out of state supplier.
• An employee such as a cashier or waitress who uses an electronic device which authorizes a credit card purchase.

Examples of Covered Employees Performing Support Work

The DOL online tool provides the following examples of employees who perform support functions for instrumentalities of interstate commerce that are so closely related to interstate commerce that they are also considered to be engaged in interstate commerce:

• A security worker at an airport.
• A custodian who works for a janitorial contractor which cleans a bus terminal.
• A laborer or mechanic who performs maintenance or repair work on machines used in the production of goods for interstate commerce or improvements to a city street.

Examples Are Not an Exclusive Listing

The above examples are not intended to be an exclusive listing. Other employees who don’t perform these tasks may still be considered to be engaged in interstate commerce.

Contact Your Labor Law Attorney for Further Information

Vision Payroll strongly recommends that employers consult with a qualified labor law attorney to determine if they are subject to the provisions of the FLSA.

Under the Patient Protection and Affordable Care Act, also known as the Affordable Care Act or Obamacare, most employers are required to provide one of two notices to all employees. Guidance was provided to employers by the US Department of Labor (DOL) in Technical Release No. 2013-02, Guidance on the Notice to Employees of Coverage Options under Fair Labor Standards Act §18B and Updated Model Election Notice under the Consolidated Omnibus Budget Reconciliation Act of 1985.

Separate Notice Not Required for Dependents

Although all employees, regardless of plan enrollment status or availability, must receive a notice, the DOL in Technical Release No. 2013-02 clarifies that “[e]mployers are not required to provide a separate notice to dependents or other individuals who are or may become eligible for coverage under the plan but who are not employees.”

Contact Vision Payroll for Further Information

Contact Vision Payroll if you have further questions on the notice to employees of coverage options required under the ACA.