When it comes to payroll, one of the most common compliance issues is the incorrect calculation of Regular Rate of Pay.
Form W-4: Employee’s Withholding Certificate
Congratulations on your new job, marriage, or new baby! Now it’s time to update your W-4. Any major life event should prompt an update to your W-4 to ensure that your employer withholds the correct federal income tax from your pay.
Expense reimbursement schemes can be a significant issue for many organizations. Fraudulent expenses are often approved and paid without being detected by managers, the accounting department, or payroll. These pay outs of fraudulent expenses directly impact the bottom line of an organization.
Payroll fraud and its prevention should be a significant concern for organizations because a single instance of fraud can average up to $70,000 and are often over three years. Additionally, small businesses are about twice as likely to experience payroll fraud as companies with more than 100 employees.
The IRS has recently issued guidance on the taxability of Dependent Care Assistance Programs (DCAP)/ dependent care FSAs for 2021 and 2022.
The other day we somehow got on the topic of whether pineapple belongs on pizza during a team call. Chances are you’ve had this debate as well. Our team was varied in our answers. In fact, we even had one recommendation against pineapple on pizza but advocating for carrots instead.
*UPDATE 1/1/2022*
Legislation that gave Municipal income tax relief and permitted employers to continue to withhold municipal income taxes based on an employee's principal place of work even though the employee may be working from home due to the COVID-19 emergency declaration is no longer in effect as of January 1, 2022.
*UPDATE 7/1/2021*
On July 1, 2021, Mike DeWine signed the 2022 – 2021 budget (HB 110) into law, ending speculation around whether employees would be eligible for refunds on municipal taxes that were withheld for a municipality in which they neither lived nor worked. The bill clarifies that employees are eligible for a refund in the 2021 tax year, but does not provide guidance on refunds for the 2020 tax year.
The bill also provides clarity to employers regarding municipal tax withholding. Under the bill, employers are allowed, but not required, to continue withholding municipal income tax based on the employer location through the end of 2021. Beginning January 1, 2022, employers will be required to withhold municipal income tax at the employee work location.
*Original Post Below*
Changes may be coming to the way employers are required to withhold municipal taxes for their Ohio employees. We know unemployment fraud and FLSA changes are hot topics right now, and I imagine this will be as well. This matter is incredibly important for those involved in processing payroll.
Effective today, May 6, 2021, the US Department of Labor has withdrawn the Independent Contractor Status Rule to maintain workers’ rights to the minimum wage and overtime compensation protection.
Many of my HR colleagues may already be familiar with the Fair Labor Standards Act (FLSA) exemption classification requirement, which provides guidance on which positions are exempt from overtime under the FLSA. However, I have come across several organizations that are unaware of these requirements and classify everyone as exempt or have misinterpreted the classification requirements by focusing solely on the salary threshold. Let's review the facts about exemption classifications.
