Payroll News » SSA

Social Security Wage Base Remains at $106,800 in 2010

Ted — Thu, 22 Oct 2009 13:30:36 +0000

The Social Security Administration (SSA) announced that the 2010 social security wage base will be $106,800, unchanged from 2009. As in prior years, there is no limit to the wages subject to the Medicare tax; therefore all covered wages are still subject to the 1.45% tax.

Also…

The AccuWage 2009 software is now available to download. The Troubleshooting page contains guidance to help you through downloading problems. The Help Guide contains extensive information on viewing, testing, and correcting errors in the wage report file. Windows Vista users can now access the Help Guide from within the AccuWage software and/or download it from the Quick Links section.

Ten Things the IRS Wants You to Know About Identity Theft

Ted — Wed, 21 Jan 2009 17:12:35 +0000

Ten Things the IRS Wants You to Know About Identity Theft

1. If you receive a letter or notice from the IRS which leads you to believe someone may have fraudulently used your Social Security Number, respond immediately to the name and address or phone number printed on the IRS notice.

2. If you receive a letter from the IRS that indicates more than one tax return was filed for you, this may be a sign that your SSN was used fraudulently.

3. Another sign that you may be the target of identity theft is an IRS letter indicating you received wages from an employer unknown to you.

4. The IRS has a department which deals specifically with identity theft issues. The IRS Identity Protection Specialized Unit is available if you have been in contact with the IRS about an identity theft issue and have not achieved a resolution.

5. You can contact the IRS Identity Protection Specialized Unit by calling the Identity Theft Hotline at 800-908-4490 Monday through Friday from 8:00 am to 8:00 pm local time (Alaska and Hawaii follow Pacific Standard Time).

6. The IRS Identity Protection Specialized Unit is also available if you believe your identity may be at risk of being stolen due to a lost or stolen purse or wallet or due to questionable activity on your credit card or your credit report.

7. The IRS never initiates communication with taxpayers about their tax account through emails. If you receive an e-mail or find a Web site you think is pretending to be the IRS, forward the e-mail or Web site URL to the IRS at phishing@irs.gov.

8. The IRS has many more resources available to help inform taxpayers about identity theft on the IRS Web site at IRS.gov. On IRS.gov you can access information on how to report scams and bogus IRS Web sites. You can also visit the IRS Identity Theft Resource Page, which you can find by typing Identity Theft Resource Page in the search box on the IRS.gov home page.

9. The Federal Trade Commission is also available to assist taxpayers with identity theft issues. You can reach them at 877-ID-THEFT (877-438-4338).

10. Visit OnGuardOnline.gov for protection tips from the federal government and the technology industry.

Social Security issues guidance on the 2008 W2 season.

Ted — Wed, 03 Dec 2008 14:37:12 +0000

Social Security Critical Links

Update Your Payroll Records – Ask employees to verify their name and SSN before you close out your books and prepare Forms W-2. If a name has changed, continue to use the old name and tell the employee to contact Social Security to obtain an updated card. Using a new name before the employee updates Social Security’s records may prevent the posting of earnings. Change your payroll records only when the employee obtains an updated Social Security card with the new name.

Avoid These Common Errors – Incorrect name or SSN; misspelled names; using nicknames or shortened names, using titles before or after the name; and name changes not reported to Social Security.

Verify Names/SSNs with Social Security – Use Social Security’s free Internet service to match employees’ names and SSNs with Social Security’s records at the time of hire or before you prepare and submit Forms W-2. Use PayMaster’s built in SSNVS file creator and check new hires periodically.

Use the Correct Name Format
Enter the name on Form W-2 as shown on the employee’s Social Security card. Compound names no longer require a hyphen. Connect parts of a compound name with either a hyphen or a blank space. Do not join them into a single word. If an employee has a compound name, include all of the parts in the appropriate name field. For example, the name John R Smith-Jones: Enter Smith Jones in the last name field.

It’s especially important to know the exact last name. If an employee provides a name with apparent compound or multiple last names, carefully question them to determine which name is the beginning of the surname and which (if any) is the middle name.

Use the Correct SSN
Enter the SSN shown on the employee’s Social Security card. No SSN can begin with an 8 or a 9. The SSN cannot be all 1s or all 3s and cannot be in the sequential order of 123-45-6789. If you hire someone who does not have a Social Security card, you can use the free Social Security Number Verification Service (SSNVS) which allows you to quickly verify whether a person’s name and SSN matches Social Security’s records, or you can ask him/her to obtain.

Social Security wage base rises to $106,800 for 2009

Ted — Fri, 17 Oct 2008 13:23:13 +0000

Social Security’s Old-Age, Survivors, and Disability Insurance (OASDI) program limits the amount of earnings subject to taxation for a given year. The same annual limit also applies when those earnings are used in a benefit computation. This limit increases each year with increases in the national average wage index. We call this annual limit the contribution and benefit base. For earnings in 2009, this base is $106,800.

The OASDI tax rate for wages paid in 2009 is set by statute at 6.2 percent for employees and employers, each. Thus, an individual with wages equal to or larger than $106,800 would contribute $6,621.60 to the OASDI program in 2009, and his or her employer would contribute the same amount. The OASDI tax rate for self-employment income in 2009 is 12.4 percent.

Say goodbye to Floppy A:

Ted — Fri, 12 Sep 2008 14:03:09 +0000

Of course PayMaster has been able to create the MMREF / EFW2 format for years but this is a reminder to be sure you have an account at SSA.GOV as you won’t be able to send the feds a floppy this year.

Beginning Dec. 1, 2008, filers of 250 or more Forms 1042-S, 1098, 1099, 5498, 8027, or W-2G must file the forms electronically through the FIRE (File Information Returns Electronically) System. After that date, the IRS will no longer accept these returns on magnetic media .

The IRS notes the following advantages to filing electronically:

(1) It’s paperless; no need to file Form 4804, Transmittal of Information Returns Reported Magnetically.
(2) It’s secure (Secure Socket Layer (SSL) 128-bit encryption).
(3) Electronic filers receive an e-mail of file status results within one to two business days after filing.
(4) Electronic filing is easy to use and there is better customer service due to the online availability of the transmitter’s file.
(5) The due date for filing electronically is March 31st, rather than February 28th.

Auto Update Your SSN Database.

Ted — Wed, 09 Jul 2008 14:16:13 +0000

Each month the SSA releases an updated list of Social Security Numbers that are newly issued as of that date. PayMaster uses this list to double check your input when you enter a new hire. If you get a message when entering a SSN , it could mean that its a newly issued number and your database is out of date. If you still get a warning of a invalid SSN after updating, you might double check your input or use the built in SSA Verification report that interfaces with the SSA’s online verification system like it.

Auto update is available now for this July change.
Just go to Utilities/Apply SQL Patches and then click on Internet/Check for SQL Updates.
It should download the patch called validSSN_July_2008.sql and then apply this patch to all companies.