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Payroll

Court shows the door to tax-protesting employee

03/19/2012
A federal appeals court has ruled that an employee-tax protester can’t sue his employer and individual employees for withholding taxes. The court also rejected the employee’s Title VII claim that he was unlawfully terminated for complaining about the withholding.

Online options for child-support withholding

03/15/2012
To speed the processing of child support with­holding orders, the federal Office of Child Sup­port Enforcement is encouraging employers to sign up for its electronic Income Withholding Order, or e-IWO. Cur­­rently, 23 states use e-IWOs.

Federal agencies offer potpourri of new benefits rules

03/15/2012
Here are digests of recent benefits rulings that will affect your Payroll operations: 1. Payroll off the hook for CLASS Act withholding. 2. Compliance with summary of benefits and coverage rules postponed. 3. HRA reporting under the Medicare-as-secondary-payer rule.

What if we can’t set up direct deposit fast enough to deliver final paycheck in time?

03/14/2012
Q. A recently terminated employee demanded immediate payment of his wages and asked us to directly deposit the check into his bank account. I know that Minnesota law requires us to pay the wages through the employee’s last day of employment within 24 hours of his demand. While this employee was normally paid through direct deposit, we cannot coordinate a direct deposit within 24 hours. Can we just send the employee a check by mail?

State laws on vacation pay after termination

03/13/2012
Whether accrued vacation pay is due to an employee upon termination is determined by state law. This chart summarizes state vacation pay laws. Some states have no laws on this issue, which means that company policy should prevail.

Employees must receive health benefits summary & glossary

03/13/2012
Employees can’t be wise consumers of health care services if they don’t understand their group health plans. Final regulations for implementing the Affordable Care Act health care reform law fill this informational gap by requiring all group health plans (including grandfathered plans, self-insured plans and plans not covered by the Employee Retirement Income Security Act) […]

Payroll deduction agreements: Too broad for their own good?

03/13/2012
Question: Included in our new employee handbook is a standard payroll deduction agreement, which employees must sign and return to Payroll. There’s a clause in the agreement that says employees’ consent to payroll deductions includes, but isn’t limited to, miscellaneous deductions—faxes, phone calls and so forth. HR has told employees that if they don’t sign the agreement, then no deductions can be made. What does Payroll tell employees?

Cash out or roll over PTO: What are the tax implications?

03/13/2012
Q. Employees who don’t use all of their paid time off (PTO) lose it at the end of the company’s fiscal year. Management wants to amend this policy to give employees the option of selling back their unused PTO days to the company at their current pay rates or rolling over the PTO days into the next year. Before Payroll gives its final OK to this plan, we’d like to know if we’re missing anything.

IRS sets rules for taxing damage awards

03/13/2012
Final IRS regulations exclude from taxpayers’ gross income damage awards for personal physical injuries or illness received from a lawsuit or in settlement of legal claims. The regs delete the requirement that to qualify for the tax exclusion, damages must be based on a tort or tort-type right.

Report: IRS correspondence audits need improvement

03/13/2012

The IRS recently announced that it has begun conducting correspondence audits of employers that took the 6.2% Social Security tax credit authorized by the 2010 Hiring Incentives to Restore Employment Act. The Treasury Inspector General for Tax Administration has concluded that the audit program remains error-prone, and that those errors affect taxpayers’ rights.