Payroll

Better late than never: Refunds of ‘excess’ transit benefits

04/19/2013

Tax season just came to a close for most taxpayers. Exception: A late-season update to the IRS’ website informs employees who had more than $125 a month withheld for qualified mass transit benefits during 2012 on how to claim a refund for their excess income and FICA taxes.

2013 State Direct Deposit/Paycard Laws

04/11/2013

State laws usually require that employees voluntarily participate in direct deposit or paycard programs. States may also allow paycard vendors to charge employees fees, beginning with the second transaction. Here’s a chart that summarizes the states’ direct deposit/paycard rules.

Withholding on bonuses: Who chooses the method

04/11/2013

Q: An employee who’s in line for a quarterly bonus has presented Payroll with a form that requires us to treat the bonus as regular wages and withhold accordingly. It’s our policy to use the 25% flat withholding method on all supplemental pay. We’ve never seen a form like this before. Must we honor it?

Phishers use third-party providers as bait

04/09/2013

Employers that outsource their payrolls to third-party payroll providers have reported receiving phony emails referring to “Password Change Notification” or “First Notice—Digital Certificate Expiration.” It’s a scam.

Setting limits on voluntary withholding

04/04/2013

Q. A contractor would like us to voluntarily withhold her federal income taxes. Accounts Payable isn’t equipped to do this, so it’s fallen to Payroll. Having her complete a W-4 form seems inappropriate, since she’s not an employee. Can we honor her request?

Records trump ‘knowledge’ of co-workers’ hours

04/03/2013

Here’s some good news: If you have complete and accurate time records, an employee’s claims that he just “knows” what hours others work isn’t going to be enough to keep a lawsuit moving.

IRS stresses enforcement at APA’s Washington summit

04/01/2013

Enforcement. That was the word from John Tuzynski, the IRS’ chief of employment tax policy, when he spoke at the American Payroll Association’s mid-year Capital summit, held in Washington, D.C., March 10-14.

The price of having too few time clocks: $1 million

03/29/2013

Long lines of employees punching in and out has cost a California employer more than $1 million in fines. The problem: Quetico Manufacturing had only three time clocks to handle 865 workers. The delays cheated employees out of overtime pay.

Responsible persons’ lifeline: Express installment agreements

03/28/2013

Undeposited payroll taxes can pile up so quickly that the IRS has a name for them—pyramiding. It also has a very effective solution: personally charging a company’s responsible persons with 100% of the undeposited taxes. Relief: an express installment agreement.

IRS loosens criteria for VCSP eligibility

03/26/2013

The IRS has made several permanent and temporary changes to its Voluntary Classification Settlement Program. Under VCSP, you can voluntarily reclassify independent contractors as employees for future tax periods on favorable tax terms. You’ll be liable for just over 10% of the wages paid to those reclassified workers for the past year; no penalties or interest will be due.