Vision Payroll

Due to severe storms, flooding, and tornadoes in Alabama on March 25, 2009, President Barack Obama declared the following counties a federal disaster area: Covington, Geneva and Houston. Therefore, the Internal Revenue Service (IRS) announced recently that it will waive failure to deposit penalties for employment and excise taxes due after March 24, 2009 and before April 10, 2009 as long as the deposits were made by April 9, 2009. Also, affected taxpayers will have until May 26, 2009 to file most tax returns. Contact Vision Payroll if you were affected by the storms, flooding, and tornadoes and need further information on the relief provided by the IRS.

This week’s question comes from Elizabeth, a small-business owner. We just hired a part-time employee who is seventy years old. He’s already collecting social security benefits so I’m not sure if I should still withhold it from his wages. At what age does social security withholding stop? Answer: There is no age beyond which employers are no longer required to withhold social security or Medicare taxes, which are also known as FICA or OASDI. Employers must continue to withhold social security and Medicare taxes and pay the employer’s portion even if the employee is collecting social security or is eligible for Medicare. The Social Security Administration will recalculate benefits and may increase them after retirement if the additional earnings result in a benefits increase. Contact Vision Payroll if you have any questions on social security and Medicare tax withholding.

According to the US Department of Labor, in the week ending May 16, the advance figure for seasonally adjusted initial claims was 631,000, a decrease of 12,000 from the previous week’s revised figure of 643,000. The 4-week moving average was 628,500, a decrease of 3,500 from the previous week’s revised average of 632,000.

The advance seasonally adjusted insured unemployment rate was 5.0% for the week ending May 9, an increase of 0.1 percentage points from the prior week’s unrevised rate of 4.9%.

The advance number for seasonally adjusted insured unemployment during the week ending May 9 was 6,662,000, an increase of 75,000 from the preceding week’s revised level of 6,587,000. The 4-week moving average was 6,480,500, an increase of 131,000 from the preceding week’s revised average of 6,349,500.

The fiscal year-to-date average for seasonally adjusted insured unemployment for all programs is 5.071 million.

As companies continue to use layoffs in an effort to control costs, they must consider whether those layoffs can cost more in the long-run due to losses in revenue generation and service quality. It is critical that companies retain their most talented employees so that they not only stay in business during the downturn, but also so that they are positioned to grow when the recovery begins. Companies that are able to identity, reward, and retain key employees will be better positioned to succeed both now and in the future.

In this month’s HRCast, a recording provided by our team of HR Pros and available exclusively on MyHRSupportCenter, you’ll learn ten tips for successful employee relationships. Among the questions that will be answered are the following:

• How do job descriptions help you improve the hiring process?
• How can you use non-monetary incentives to improve morale?
• Which three checkpoint questions can you ask to determine if you have the right people in the right positions?

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’re not yet signed up or would like a free trial of MyHRSupportCenter, contact Vision Payroll today.

In IR-2009-050, the Internal Revenue Service (IRS) has announced the release of Notice 1036-P, Additional Withholding for Pensions for 2009, in order to help some pensioners avoid a smaller refund or a balance due when filing their 2009 Form 1040.

Although using the new tables is not required, recipients from plans that adopt the new tables will not need to take any further action to have their withholding adjusted. The IRS is encouraging pension payors who choose to use the new withholding tables to notify pension recipients who requested additional withholding on Form W4-P, Withholding Certificate for Pension or Annuity Payments, after the February tables were released.

The IRS is recommending certain types of taxpayers should consider filing revised forms, especially if they use the IRS withholding calculator and determine that their withholding may be insufficient. Those types of taxpayers include the following:

• Married couples with two incomes
• Individuals with multiple jobs
• Dependents
• Some social security recipients who work
• Workers who do not have valid social security numbers

Workers who wish to adjust their withholding should file revised Form W-4, Employee’s Withholding Allowance Certificate or its Spanish equivalent, Formulario W-4(SP), Certificado de Exención de la Retención del Empleado to adjust their withholding.

Contact Vision Payroll if you have any questions on Notice 1036-P.

Due to severe storms, flooding, tornadoes, and straight-line winds in Florida on March 26, 2009, President Barack Obama declared the following counties a federal disaster area: Calhoun, Dixie, Gilchrist, Hamilton, Holmes, Jackson, Lafayette, Leon, Levy, Liberty, Madison, Okaloosa, Santa Rosa, Suwannee, Wakulla, Walton and Washington. Therefore, the Internal Revenue Service (IRS) announced recently that it will waive failure to deposit penalties for employment and excise taxes due after March 25, 2009 and before April 11, 2009 as long as the deposits were made by April 10, 2009. Also, affected taxpayers will have until May 26, 2009 to file most tax returns. Contact Vision Payroll if you were affected by the storms, flooding, tornadoes, and straight-line winds and need further information on the relief provided by the IRS.

Due to severe storms and flooding in Georgia on March 26, 2009, President Barack Obama declared the following counties a federal disaster area: Ben Hill, Berrien, Brantley, Brooks, Camden, Coffee, Colquitt, Decatur, Dougherty, Echols, Lanier, Lowndes, Miller, Mitchell, Montgomery, Pierce, Tattnall, Tift, Ware, Wheeler and Worth. Therefore, the Internal Revenue Service (IRS) announced recently that it will waive failure to deposit penalties for employment and excise taxes due after March 25, 2009 and before April 11, 2009 as long as the deposits were made by April 10, 2009. Also, affected taxpayers will have until May 25, 2009 to file most tax returns. Contact Vision Payroll if you were affected by the storms and flooding and need further information on the relief provided by the IRS.

Due to severe storms and tornadoes in Arkansas on April 9, 2009, President Barack Obama declared the following counties a federal disaster area: Ashley, Miller, Polk and Sevier. Therefore, the Internal Revenue Service (IRS) announced recently that it will waive failure to deposit penalties for employment and excise taxes due after April 8, 2009 and before April 25, 2009 as long as the deposits were made by April 24, 2009. Also, affected taxpayers will have until June 8, 2009 to file most tax returns. Contact Vision Payroll if you were affected by the storms and tornadoes and need further information on the relief provided by the IRS.

This week’s question comes from Joel, an HR director. We just implemented a Health Savings Account plan at our company. We know the amounts employees can contribute for 2009. What are the 2010 Health Savings Account inflation adjustments? Answer: the Internal Revenue Service recently released Rev. Proc. 2009-29 which contained the 2010 inflation adjusted amounts for Health Savings Accounts or HSAs.

The annual limitation on deductions will increase from $3,000 in 2009 to $3,050 in 2010 for those with self-only coverage. Those with family coverage will have the deduction limitation increase from $5,950 to $6,150.

The definition of a high deductible health plan will change from one with a minimum deductible of $1,150 in 2009 to $1,200 in 2010 for self-only coverage and from $2,300 to $2,400 for family coverage.

The annual out-of-pocket limitation for 2010 will also increase from $5,800 in 2009 to $5,950 for those with self-only coverage; the out-of-pocket limitation for family coverage will increase from $11,600 to $11,900.

Contact Vision Payroll if you have any questions on Rev. Proc. 2009-29 and the changes to HSAs for 2010.

According to the US Department of Labor, in the week ending May 9, the advance figure for seasonally adjusted initial claims was 637,000, an increase of 32,000 from the previous week’s revised figure of 605,000. The 4-week moving average was 630,500, an increase of 6,000 from the previous week’s revised average of 624,500.

The advance seasonally adjusted insured unemployment rate was 4.9% for the week ending May 2, an increase of 0.1 percentage points from the prior week’s unrevised rate of 4.8%.

The advance number for seasonally adjusted insured unemployment during the week ending May 2 was 6,560,000, an increase of 202,000 from the preceding week’s revised level of 6,358,000. The 4-week moving average was 6,337,250, an increase of 128,750 from the preceding week’s revised average of 6,208,500.

The fiscal year-to-date average for seasonally adjusted insured unemployment for all programs is 5.011 million.