Payroll News

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 [email protected].

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.

Filed under: Federal News - - - Tags: Identity Theft, IRS, SSA
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Recommendations for Successful Delivery of an Economic Stimulus Via Workers Paychecks
PDF of APA’s Letter

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.

Filed under: Federal News, PayMaster Software, Payroll News - - - Tags: APA, IRS, Obama, Slow economy, Withholding
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IR-2009-2, Jan. 6, 2009

WASHINGTON — The Internal Revenue Service today kicked off the 2009 tax filing season by announcing a number of new steps to help financially distressed taxpayers maximize their refunds and speed payments while providing additional help to people struggling to meet their tax obligations.

With many people facing additional financial difficulties, the IRS is taking several additional steps to help people who owe back taxes.

“We need to ensure that we balance our responsibility to enforce the law with the economic realities facing many American citizens today,” Shulman said. “We want to go the extra mile to help taxpayers, especially those who’ve done the right thing in the past and are facing unusual hardships.”

On a wide range of situations, IRS employees have flexibility to work with struggling taxpayers to assist them with their situation. Depending on the circumstances, taxpayers in hardship situations may be able to adjust payments for back taxes, avoid defaulting on payment agreements or possibly defer collection action.

The IRS reminds taxpayers who are behind on tax payments and need assistance to contact the phone numbers listed on their IRS correspondence. There could be additional help available for these taxpayers facing unusual hardship situations.

Areas where the IRS can provide assistance:

• Postponement of Collection Actions: IRS employees will have greater authority to suspend collection actions in certain hardship cases where taxpayers are unable to pay.
• Added Flexibility for Missed Payments: The IRS is allowing more flexibility for previously compliant individuals in existing Installment Agreements who have difficulty making payments because of a job loss or other financial hardship.
• Additional Review for Offers in Compromise on Home Values: An Offer in Compromise (OIC), an agreement between a taxpayer and the IRS that settles the taxpayer’s tax debt for less than the full amount owed, may be a viable option for taxpayers experiencing economic difficulties.
• Expedited Levy Releases: The IRS will speed the delivery of levy releases by easing requirements on taxpayers who request expedited levy releases for hardship reasons.

See the Press Release for complete details.

Filed under: Federal News - - - Tags: IRS, Slow economy
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As of Jan 5, 2009 , the following states all have updated tax tables.

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.

Filed under: Payroll News, State News - - - Tags: Missouri, Ohio, Withholding
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Obama’s paycheck bonus
You might not get a raise next year. But if the economic stimulus ideas being floated are any indication, you might get more money on payday anyway.

NEW YORK (CNNMoney.com) — For many cash-strapped workers, Barack Obama’s plan to stimulate the economy could mean more take-home money in their paychecks.

While details remain unclear, the president-elect’s recovery proposal is likely to include a tax cut to boost spending. Exactly how much of a break that could mean for workers depends on how the tax cut is structured.

But the proposal most likely to get money into the hands of the greatest number of taxpayers quickly is some form of Obama’s proposed Make Work Pay Credit.

The credit would essentially work as a payroll tax credit equal to $500 a year for individuals and $1,000 for couples. And the money could be delivered fairly quickly simply by having employers reduce the tax withholding in a person’s paycheck.

Filed under: Federal News, Payroll News - - - Tags: IRS, Slow economy, Withholding
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The IRS has released Publication 15 (Circular E) Employer’s Tax Guide for 2009.

http://www.irs.gov/pub/irs-pdf/p15.pdf

Filed under: Federal News, Payroll News - - - Tags: IRS
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Seven states announcing minimum wage increases for Jan. 1, 2009.

Arizona will increase from $6.90 to $7.25 per hour.
Colorado will increase from $7.02 to $7.28 per hour.
Missouri will increase to $7.05 per hour. Tipped employees will increase to $3.525 per hour.
Ohio will increase to $7.30 and $3.65 for tipped employees.
Oregon will increase from $7.95 to $8.40 per hour
Vermont will increase from $7.68 to $8.06 per hour. Tipped employees will increase from $3.72 to $3.91 per hour.
Washington will increase from $8.07 per hour to $8.55 per hour.

Filed under: Payroll News, State News - - - Tags: Arizona, Colorado, DOL, Minimum Wage, Missouri, Ohio, Oregon, Vermont, Washington
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(Washington, DC) – The District of Columbia income tax withholding tables and formulas have been changed to reflect the increases in the personal exemption and standard deduction. Employers must make use of the new tables and formulas for wages paid on or after January 1, 2009.

Filed under: Payroll News, State News - - - Tags: DC, Withholding
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In anticipation of the 2009 tax tables being released, we have updated the corresponding help file to help you with this procedure. You can access this by going to the Help/Web Based Manual and navigating to the Utilities/Apply SQL Patches topic or visit the direct link to

http://paymaster-pro.com/htmlhelp/topics/ApplySQLPatches.html

Filed under: PayMaster Software - - - Tags: HELP, PayMaster Software, Tax Tables
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All customers who have a current support contract are entitled to receive the End of Year update and the 2009 tax tables. Please contact support before printing your 2008 W2s and before running your first 2009 payroll. Besides the 2008 W2 module, the EOY of update is a rollup of all the fixes, optimizations, and new reports created over the year.  Please call the office to be sure your support contract is up to date and receive instructions on how to download and install the 2008 update.

Since each day states are releasing modifications to the tax code for 2009, the tax table update is not included in the EOY update. It will be released separately and will be available the week of Dec 22,2008 .

For instructions on how to install the tax table update see the latest Blue Pages or call support.

As of Dec 10,2008 this is what is included in the 2009 tax table update.

DO NOT APPLY THIS PATCH UNTIL YOU ARE READY TO RUN YOUR FIRST 2009 PAYROLL.

Updates Federal, EIC, OASDI Max.

State Withholding Tables Updated (CA,CO,ME,MI,MN,ND,NM,OH,OK,OR,VT)

SUTA Wage Bases Updated. (ID,IL,IA,MN,MO,MT,ND,NV,NJ,NM,OK,SD,WA,WI,WY)

Filed under: Federal News, PayMaster Software, State News - - - Tags: Auto Update, End of Year, PayMaster Software, SUTA, Tax Tables, Withholding
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