Payroll

New myRAs seek to spur retirement savings among low-income workers

02/10/2014

In his State of the Union address, President Obama announced that he was directing the Treasury Department to create “myRA”—a government-backed affordable “starter retirement savings account that will help millions of low- and middle-income Americans begin to save for retirement.”

Special analysis: Beware of employees who work interstate

02/07/2014

If you’re located in only one state, you never have to worry about withholding another state’s income taxes or applying another locality’s paid sick leave law, right? Not necessarily. It’s possible that you’ve become an interstate employer without knowing it.

Post-DOMA: Cafeteria plans given leeway for same-sex spouses

02/05/2014

Breathe a little easier if you have a cafeteria plan that, after the demise of the federal Defense of Marriage Act and before the IRS released guidance, allowed same-sex married employees to cover their spouses’ health insurance on a pretax basis or allowed them to seek reimbursement from health or dependent care flexible spending accounts.

Sample Request Form for Corrected/Reissued 2013 W-2s

02/04/2014

It’s almost inevitable that some employees will misplace their original W-2 statements. Here’s a sample form employees can use to request a reissued W-2.

Send the groundhog packing! Avoid repeating EFW2 mistakes

02/03/2014

In the movie “Groundhog Day,” the protagonist was destined to repeat the same day over and over again. If you’ll be e-filing your W-2s using the Social Security Administration’s EFW2 filing specs, you can avoid repeating filing mistakes by taking a stroll through this checklist.

S corps lose again on reasonable FICA-taxable pay

02/03/2014

In Watson v. U.S., an appellate court ruled that the IRS can recharacterize FICA-free distributions from S corps to their owners as FICA-taxable compensation, and allowed the IRS to set the parameters for determining that reasonable FICA-taxable salary. And so far it’s nailed S corps and their owners 100% of the time. Two recent cases illustrate.

Final regs clarify the 0.9% additional Medicare tax

01/29/2014

You’ve been withholding and reporting the 0.9% additional Medicare tax for a year now. Good news: With the exception of clarifying the procedure you use to request relief from paying any additional tax if employees paid the tax with their 1040 forms, final regulations make no changes to the proposed regs.

Pay up promptly when offering severance

01/28/2014

Sometimes, it’s clear from the moment that you decide to terminate an employee that she will sue. If that’s the case, a small severance payment may prevent litigation. But if you offer to settle, make sure you follow through promptly.

Is time that an employee spends on-call compensable?

01/28/2014

Q: An employee carries a company-issued smartphone so he can respond to emergencies over the weekend. He can usually resolve an issue with a phone call. How should we pay him—for the time he’s responding to an emergency or for all the time he has the phone?

2014 standard mileage rate decreases .5¢, to 56¢ per mile

01/27/2014

Reflecting a drop in gas prices, the IRS’ standard mileage rate—which you may use to reimburse employees who drive their own cars on business—drops to 56¢ a mile for 2014, down from 56.5¢.