Based on Method B
http://www.dor.state.wi.us/pubs/pb166h.pdf

Oct012009_tax_WI.sql is available now for updating.

New tax tables will be available once the official tables are released…

More info on this increase

CA.gov EDD page

This is the second time this year that CA has issued tax tables and increased withholding.

A new tax law raises California’s personal income tax rates by .25 percent.  The law also reduces the dependent exemption credit to the same amount of the personal exemption credit—a $210 difference per dependent using 2008 amounts. Some taxpayers may need to increase their wage withholding now to avoid owing taxes next April.

The Employment Development Department (EDD) made new withholding tables available to employers in April, but taxpayers may be under withheld at least from January through April 2009.

The updated tax tables were issued to Paymaster users in April but you still may be underwitheld as the increase was retro active.

The new withholding tables factor in the changes for the tax rate increase only, so taxpayers claiming dependent exemption credits may still need to modify their wage withholding on Form DE 4, Employee’s Withholding Allowance Certificate, to make any needed changes to the number of allowances they claim.

As of April 20th , these tax tables are available to all Paymaster customers through the Apply SQL Patch menu itm in the program. The new tax tables are easily installed, directly from the PayMaster program by going to Utilities / Apply SQL Patches and selecting Internet/Check for SQL updates. The program should then download a file called 2009-taxCA.sql, 2009-taxNY.sql and 2009-taxAZ.sql. Select the appropriate file for your withholding states and apply to all active companies by checking them off.  Of course if you have any questions or concerns feel free to call the support line.

10%, will increase to 11.5% from May 1, 2009 to EOY (10.7% in 2010)
19%, will increase to 21.9% from May 1, 2009 to EOY (20.3% in 2010)
23%, will increase to 26.5% from May 1, 2009 to EOY (24.5% in 2010)
25%, will increase to 28.8% from May 1, 2009 to EOY (26.7% in 2010)
31%, will increase to 35.7% from May 1, 2009 to EOY (33.1% in 2010)
37%, will increase to 42.6% from May 1, 2009 to EOY (39.5% in 2010)

An update to Paymaster for the 2009 tax year will be available momentarily.

Available for tax years 2009 and 2010, the credit is 6.2 percent of a taxpayer’s earned income with a maximum credit of $800 for a married couple filing a joint return and $400 for other taxpayers, but it is phased out for higher income taxpayers.

Many higher-income taxpayers will see little or no change in their take-home pay. That’s because the Making Work Pay credit is phased out for a married couple filing a joint return whose modified adjusted gross income (AGI) is between $150,000 and $190,000 and other taxpayers whose modified AGI is between $75,000 and $95,000.

Taxpayers will not get a separate, special check mailed to them from the IRS like last year’s economic stimulus payment.

The new tax tables are easily installed, directly from the PayMaster program by going to Utilities / Apply SQL Patches and selecting Internet/Check for SQL updates. The program should then download a file called 2009-stimulusupdate.sql. Select this file and apply to all active companies by checking them off. Of course if you have any questions or concerns feel free to call the support line.

The IRS asks that employers start using these new tables as soon as possible but not later than April 1.

The tax cuts are part of a $787 billion economic recovery plan passed by the Democratic-controlled Congress over Republican opposition. The aim is to put more money in the pockets of Americans and stimulate the economy by increasing consumer spending.

“I’m pleased to announce that this morning the Treasury Department began directing employers to reduce the amount of taxes withheld from paychecks, meaning that by April 1st, a typical family will begin taking home at least $65 more every month,” Obama said in his weekly radio address.

As soon as the IRS releases new tax tables, an update will be available for the PayMaster Program.

Note. You cannot claim exemption from withholding if (a) your income exceeds $950 and includes more than $300 of unearned income (for example, interest and dividends) and (b) another person can claim you as a dependent on their tax return.

The American Payroll Association is recommending that to get this credit in the hands of American workers quickly and effectively, they recommend modifying the current income tax and withholding tables.

The current proposal involves a refundable income tax credit equal to 6.2% of the first $8,100 in wages subject to Federal Income Tax (FIT), resulting in a maximum credit of $502.20.

The APA suggests:

“Modify the current income tax and withholding tables to reflect a carve-out of $8,100 of
the 10% wage bracket, to be taxed at 3.8% (10% less 6.2%), and to reflect any additional tax
necessary in the higher wage brackets for anyone for whom the credit is not intended (i.e.,
phase-out for those earning more than a threshold amount of wages).”

“Require employers to apply the new withholding tables ‘as soon as administratively
practical,’ with a specific target date six to ten weeks after enactment. This will allow
employers who are able to immediately apply the change to do so, and it will recognize that
some systems are set up to make these sorts of changes at the first of a month or a quarter.”

“Stipulate that no employee’s FIT withholding for the year may be less than zero. An
employer may try to front the entire credit to some employees (!), but IRS and SSA systems
are not set up to accept negative numbers on Form W-2 and most fields of Form 941
(Employer’s Quarterly Federal Tax Return), and employer systems are accordingly
programmed not to allow such numbers.”

The APA and PayMaster believe that this would be the that this would be the most effective way to get this tax credit in the hands of the masses and reduce the burden on payroll professionals. The other reccomendations being suggested by the administration would require more complex programming, would increase the bookkeeping burden, and different taxpayers would have different experiences in receiving the credit.

California,Colorado,Connecticut,District of Columbia,Kentucky,Maine,Michigan,Minnesota,Missouri,New Mexico,North Dakota,Ohio,Oklahoma,Rhode Island,Vermont.

Note: OH and MO were NOT included in the 2009 tax table update due to late releases and must be downloaded separately. If you do payroll in these two states be sure to apply the state specific patch soon to ensure proper withholding.