Vision Payroll

The Employee Benefits Security Administration (EBSA)has given notice that it will hold a hearing to consider issues relating to the disclosure of fee, conflict of interest and other information by service providers to group health, disability, severance and other employee welfare benefit plans under §408(b)(2) of the Employee Retirement Income Security Act (ERISA).

Hearing to Be Held in Washington, DC

The hearing will be held on December 7, 2010, beginning at 9 am, EST, at the US Department of Labor, Room S-4215 (A-C), 200 Constitution Avenue, NW, Washington, DC 20210.

Meeting Agenda Has Been Released

The agenda for the hearing on disclosure of fees and expenses to welfare plan fiduciaries has been released and is available for download from the Vision Payroll website.

The Pennsylvania Department of Labor & Industry has announced the taxable wage base for 2011. The wage base will remain at $8,000 for 2011.

Wage Base Does Not Apply To Employee Withholding

Pennsylvania employees are subject to withholding for unemployment tax. The withholding rate of 0.08% of taxable wages will not change from 2010. There is no wage base for withholding, however; all taxable wages are subject to withholding at this rate.

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

The Michigan Department of Treasury has released Publication 446, 2011 Michigan Income Tax Withholding Guide.

Withholding Rate and Personal Exemption Amount Announced

For wages paid after December 31, 2010 and before October 1, 2011, the withholding rate is 4.35% and the personal exemption amount is $3,700. For wages paid after September 30, 2011, a withholding rate reduction takes effect. Employers may calculate the reduced withholding by multiplying the withholding amount in the Michigan Income Tax Withholding Tables by 0.977. Alternatively, revised tables will also be released.

Exemptions Claimed on Form MI-W4

Employers should calculate Michigan withholding using the number of exemptions claimed on Form MI-W4, Employee’s Michigan Withholding Exemption.

Vision Payroll Using Updated Withholding Tables

Michigan employers do not need to take any further action as Vision Payroll will automatically transition to the revised withholding amounts on the effective dates.

The South Carolina Department of Employment and Workforce has announced that pursuant to SC General Assembly Bill 391, the taxable wage base will increase for 2011. The wage base will increase from $7,000 for 2010 to $10,000 for 2011.

Further Increases Are Already Scheduled for 2012 and Beyond

The wage base is scheduled to increase to $12,000 for 2012 through 2014 and to $14,000 for 2015 and later years.

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

The Minnesota Department of Employment and Economic Development has announced the taxable wage base for 2011. The wage base will remain at $27,000 for 2011.

New Employer Tax Rates to Increase

The tax rates for new employers will increase from 1.91% to 2.41% for new employers in non-high experience rating industries and will increase from 8.00% to 8.90% for new employers in high experience rating industries.

Federal Loan Interest Assessment Set at 2%

A federal loan interest assessment of 2% will take affect for 2011. This is calculated by multiplying the sum of the employer’s tax and “Additional Assessment” of 14% by 2%.

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

This week’s question comes from Peter, a company controller. I read that Michigan is a credit reduction state for 2010. Are there any other credit reduction states for 2010? Answer: Federal law provides for a reduction in the FUTA tax credit when a state has outstanding federal loans for two years. The credit reduction is calculated on Schedule A of Form 940.

South Carolina and Michigan Are the Credit Reduction States for 2010

In addition to Michigan, the South Carolina Department of Employment and Workforce has announced that South Carolina is also a FUTA credit reduction state for 2010.

Maximum Tax Increase Is $21 per Employee

Since this is South Carolina’s first year as a credit reduction state, the credit reduction will be 0.3% or a maximum of $21 per employee. This is calculated by multiplying the wage base of $7,000 by the credit reduction of 0.3%.

Michigan, South Carolina and Indiana Are Credit Reduction States for 2010

As noted elsewhere and in the comments, the three credit reduction states for 2010 are Michigan, South Carolina, and Indiana. Unless Congress changes the rules or states make significant changes, as many as thirty-eight states may be credit reduction states in 2011.

Vision Payroll Will Calculate the Credit Reduction for All South Carolina Clients

Contact Vision Payroll if you have any further questions on the South Carolina credit reduction.

According to the US Department of Labor, in the week ending November 13, the advance figure for seasonally adjusted initial claims was 439,000, an increase of 2,000 from the previous week’s revised figure of 437,000. The 4-week moving average was 443,000, a decrease of 4,000 from the previous week’s revised average of 447,000.

Advance Seasonally Adjusted Insured Unemployment Rate Decreases

The advance seasonally adjusted insured unemployment rate was 3.4% for the week ending November 6, a decrease of 0.1 percentage points from the prior week’s revised rate of 3.5%.

Advance Seasonally Adjusted Insured Unemployment Decreases

The advance number for seasonally adjusted insured unemployment during the week ending November 6 was 4,295,000, a decrease of 48,000 from the preceding week’s revised level of 4,343,000. The 4-week moving average was 4,353,250, a decrease of 45,500 from the preceding week’s revised average of 4,398,750.

A clear, well-written company employee handbook is crucial to your business. Look closely at your company practices and make sure you have at least the minimum crucial types of policies in place to communicate to your employees and protect your business.

Three Questions to Refine Your Handbook

1. What should we include in the handbook?
2. What should we exclude from the handbook?
3. What general steps should we keep in mind?

Get Help Refining Your Employee Handbook Now

To obtain more information about each of these items, be sure to listen to Bulletproofing Your Company Employee Handbook 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 Unemployment Insurance Agency of the State of Michigan Department of Energy, Labor & Economic Growth, the FUTA tax credit reduction rate will increase from 0.3% in 2009 to 0.6% in 2010.

Standard Credit Rate is 5.4% for 2010

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.

FUTA Wage Base is $7,000 for 2010

Since the FUTA wage base is $7,000 for 2010, a maximum tax of $56 per employee is due, calculated as follows:

FUTA Taxable Wage Base
FUTA Taxable Wage Base	$7,000
FUTA Tax Rate	6.2%
Maximum FUTA Tax per Employee Before Credit $434.00	$434
Less: FUTA Tax Credit Reduction ($7,000 X 5.4%)	$378
Maximum Net FUTA Tax per Employee	$56

Employers in Certain States Are Subject To Credit Reduction

Federal law provides for a reduction in the FUTA tax credit when a state has outstanding federal loans for two years. The credit reduction is calculated on Schedule A of Form 940.

Michigan Is Subject To Credit Reduction for Second Consecutive Year

Since Michigan was already subject to a credit reduction in 2009 of 0.3%, the credit reduction will increase to 0.6% for 2010. The credit reduction will continue to increase by 0.3 percentage points each year until the loan is paid, e.g., 0.9% in 2011, 1.2% in 2012, etc.

Vision Payroll Will Calculate the Credit Reduction for All Michigan Clients

Contact Vision Payroll if you have any further questions on the Michigan credit reduction.

The Colorado Department of Labor and Employment has announced that since the UI Trust Fund balance as a percentage of the total wages reported by ratable Colorado employers was less than zero, the solvency surcharge would be assessed for rate year 2011.

UI Trust Balance Must Not Be Less than 0.9% of Total Wages

Whenever the UI Trust Fund balance is less than nine-tenths of one percent of the total wages reported by ratable Colorado employers, the solvency surcharge remains in effect.

Only Certain Employers Are Assessed the Solvency Surcharge

The solvency surcharge is not assessed to state and local government agencies, reimbursable and group-rated political subdivisions, and nonprofit organizations that are reimbursable employers.

Colorado Wage Base to Remain at $10,000 for 2011

The taxable wage limit is $10,000 per employee in 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 Colorado unemployment taxable wage base or visit our Unemployment Taxable Wage Base page.