See the chart below for how it will affect your payroll.

Be sure to contact your payroll processor to make them aware of this change.

For companies that have a payday that falls on Monday February 20th, make sure you talk to you payroll processor about moving your payday up.

Payrolls can be moved up to Friday 2/17. Payroll information will be needed by Wednesday 2/15.

Recently we have gotten many questions regarding State Unemployment Insurance (SUI) Rate Notices. Typically between mid-December and the beginning of the calendar year, state agencies are sending out SUI notices via mail. This notice gives the exact rate to use in either Quickbooks payroll, Intuit payroll or any other payroll processing programs. This information must be passed along to your payroll processor as these programs cannot automatically update the rate. Each company has a unique rate that could change any year. The notice itself shows the calculations used to determine what rate is assigned. The notice will have an effective date as well. Once you get the notice, your payroll processor can update your rate. At this point, if you have not received your SUI notice, don’t panic. Some agencies send notices out after the new quarter has already started. Have your payroll processor continue running payroll with the same rate from the last notice until you get it. Certain payroll processing programs like Quickbooks will recalculate your liabilities based on your new rate. This applies to State Disability Insurance Rates as well which affects: New York, New Jersey, Rhode Island, California, and Hawaii. Ultimately if you are unsure of anything concerning state tax rates, contact your payroll processor or the Department of Revenue in your state.

Starting January 1, 2012 minimum wage for all Florida employees will increase from $7.31 an hour to $7.67 an hour. All employers must make this change according to the Fair Labor Standards Act. Any employees that earn wages on a “tipped basis” also get an increase of their hourly rate to $4.65 an hour which is effective at the first of the year. Employers- make sure you are in compliance with this new law; Check with your payroll processor to ensure they are aware of the change and how it will affect your payroll. Employees – check in with your managers or employers to see if this will affect your pay rate.

The Florida Department of Revenue is mailing out Unemployment Compensation Tax Rate Notices to all businesses that pay employees. This notice is to make you aware of your 2012 State Unemployment Tax Rate. After you complete your last payroll in 2011, change your SUTA rate in whatever payroll software you use or send that notice to your payroll company as soon as you receive it. Failing to change the rate could cause significant tax problems in 2012. Contact your payroll processor if you have any questions.

Check in with your payroll processor should you want to make any changes to you payroll schedule so that your employees are paid correctly.

Make sure to get in touch with your payroll processor to discuss next years’ HSA contribution change.

There are two possible deposit schedules a company could fall into; a monthly depositor or a semi-weekly depositor.  How to determine which kind of depositor you are? It is based on the amount of taxes within a 4 quarter lookback period. For each year the lookback period is the second two quarters from 2 years ago and the first two quarters of the previous year. For example, for the entire year of 2011 use the lookback period of: 3^rd and 4^th quarter from 2009 and 1^st and 2^nd quarter for 2010.  Add up the taxes paid from each of those four quarters. If the total taxes from those four quarters exceed $50,000 then you are a semi-monthly depositor. If the total taxes is less than $50,000, you are a monthly depositor. This schedule holds true whether your company files Form 941 or Form 944.

Keep in Mind:

-          Deposit schedule is not dependant on how often employees are paid

-          Deposit schedule is does not mandate how many times you must deposit – example: a company may be a semi-weekly depositor but only pay their employees once a month, so they would only make one tax deposit on the day corresponding with their payday.

-          Tax deposits must be made through a transfer of electronic funds

-          The tax payment is required to be paid in full

-          Penalties may arise due to past-due payment or an underpayment

-          There is no difference in tax withholding for part-time or full-time employees

Make sure to talk to you payroll company regarding this matter.

If you are one of our online payroll clients, please use the information below to determine when you will need to submit your time to us.

If your regular pay date is Monday, February 21, change your paycheck date to Friday, February 18 and send your payroll to us by 5:00 pm Pacific Time on Wednesday, February 16. Your account will be debited on Thursday, February 17, and your employees will receive their direct deposits on Friday, February 18.

If your regular pay date is Friday, February 18, send your payroll to us by Wednesday, February 16.  Your account will be debited on Thursday, February 17, and your employees will receive their direct deposits on Friday, February 18.

If your regular pay date is Tuesday, February 22, send your payroll to us by Thursday, February 17.   Your account will be debited on Friday, February 18, and your employees will receive their direct deposits on Tuesday, February 22.

If your regular pay date is Wednesday, February 23, send your payroll to us by Friday, February 18.  Your account will be debited on Tuesday, February 22, and your employees will receive their direct deposits on Wednesday, February 23.

Remember, your bank account is typically debited before regular banking hours, so you should have sufficient available funds in your account the day before the actual debit occurs.

• worker classifications (employees incorrectly classified as independent contractors),
• taxability of fringe benefits,
• information reporting compliance, and
• officer’s compensation. 

Over the next few months our newsletter will address each of these sections to help you assess your current compliance with these areas of audit focus.  Register for our newsletter to the top right of this article.