Child Support in the 21st Century

Child support is going digital.  President Obama has signed into law legislation that now requires all states to provide the option to receive the child support withholding orders (IWO) electronically.  The deadline for the states is October 1, 2015.  The electronic version of the IWO, known as the e-IWO, has been available for a couple of years through the Federal Office of Child Support Enforcement (OCSE).  According to the OCSE’s website currently 32 states offer this option.  These include AL, AZ, AR, CA, CO, CT, DE, DC, FL, HI, ID, IL, IN, ME, MA, MI, MO, NC, ND, NE, NJ, NY, OH, OK, OR, PA, SD, TN, TX, VA, WA, and WV.  Two more states, KY, and MD are currently implementing the process.

This process allows the employer to receive the IWO (as a PDF file) through a portal directly into the employer’s computer.  This is not done through email but rather through either a Secure File
Transfer Protocol (SFTP) or a File Transfer Protocol Secure (FTPS). This process allows the employer to accept or reject the IWOs electronically as well as process terminations.  Large employers can implement a fully automated system.  However, smaller employers can use the no programming option that is easy to implement with limited technical resources.

The OCSE is pushing for employers to sign up now to use this electronic service. For more information check out the OCSE’s webpage on Electronic Income Withholding Orders or contact

Hey We All Make Mistakes Most of Us Don’t Devote a Web Page to It

The IRS has announced that it has reissued the Publication 509 due to an error on the deposit schedule on page 11.  So if you have not downloaded the latest version you will need to update your files.  The IRS having to reissue a publication or make a correction is not uncommon. In fact, I, myself, have discovered 4 to 5 errors in publications that I have pointed out to the IRS over the years.  One year, the IRS made a calculation error when demonstrating the percentage method in the Circular E and supposedly received thousands of emails and phone calls from payroll professionals questioning the calculations.  Although payroll professionals know and understand that the errors will occur what many do not know is that the IRS has a webpage devoted to these corrections.  When they update a form, its instructions or a publication they usually publish it on this page .  Then if they have an error or correction they announce it on this page.  It is very handy  and one I recommend checking from time to time.

FUTA Credit Reduction–Just Out

My sources (not the DOL or IRS as of yet) are telling me that the following states will have a credit reduction for FUTA for 2014.  The IRS has not released the Form 940 Schedule A as of this time but the source I have is pretty reliable so I will post just to give you a heads up.  I will also post when the IRS releases the forms.  The states are: California, Connecticut, Indiana, Kentucky, New York, North Carolina and Ohio.  The list also includes the Virgin Islands.  All will have a rate of 1.2% credit reduction for a net FUTA rate of 1.8% except for Connecticut and Indiana.  Connecticut will have a credit reduction of 1.7% with a net FUTA rate of 2.3%.  Indiana will have a credit reduction of 1.5% with a net FUTA rate of 2.1%.  Again I will post the Form 940 and the Schedule A as soon as they are released.

Paid Sick Leave is on the Move–Up Next Massachusetts

The sick pay movement has another notch on its belt for a resounding win in Massachusetts. 60% of the voters approved the measure known as Question 4 on Tuesday making Massachusetts the third state in the union behind Connecticut and California to mandate sick leave. Employers with 11 or more workers have to provide paid sick leave, those with 10 or less do not have to provide paid sick leave but must let the workers take unpaid time off in the same situations. And it is illegal for companies to punish workers for exercising their rights under the new law.

The details are as follows: Employers must provide their workers with one hour of paid sick leave for every 30 hours they work. It is capped at 40 hours of leave for the year. It is effective July 1, 2015. Workers can use the time when they are ill, injured or need to tend to a medical condition. They may also use it when a spouse, child or parent needs to be cared for. Employees can begin to use their earned sick leave on the 90th day of employment. They can carry over up to 40 hours of unused sick leave in the next calendar year but may not use more than 40 in a calendar year. Employers may require the employee to certify their need for sick time if they use more than 24 consecutively schedule work hours. Employees need to make a good faith effort to give employers advance notification if the need to use the earned sick leave is foreseeable such as doctor appointments.

I have been on my soap box about mandated sick leave for years. Of course I am all for it. But why can’t we do it like other “industrialized nations” and have one federal law that mandates sick leave or just PTO. We are the only country out of 140 leading nations that does not give workers paid sick leave on the national level. Instead we get it either on the state level or even worse on the city level. This is what creates the burden on employers, or as I see it, payroll professionals. Not that I have to track one sick leave law but that I have to track it state by state and city by city.

But those that champion mandatory sick leave (and I am one of them) including labor unions and groups devoted to working women and mothers are on a roll and since they can’t get anything done in Congress they are taking their cause to the “streets” and winning there.

Mark Your Calendar

IRS: Has released the 2015 Publication 509 Tax Calendars. This publication shows the legal holidays for 2015 as well as the general, employer’s and excise tax calendars for the year. It also includes a table showing the semiweekly deposit schedule due dates for 2015.

The legal holidays for 2015 are as follows:

January 1–New Year’s Day

January 19–Birthday of Martin Luther King, Jr./Inauguration Day

February 16–Washington’s Birthday

April 16–District of Columbia Emancipation Day

May 25–Memorial Day

July 3–Independence day is observed

September 7–Labor Day

October 12–Columbus Day

November 11–Veteran’s Day

November 26–Thanksgiving Day

December 25–Christmas Day


Remember that a statewide legal holiday does not delay a due date for making a federal tax deposit.

Taking the Time off to Vote

Today is the mid-term elections. And it always puzzles me why we don’t have a better turn-out when it comes to voting in this country. Voting is free, in many places it opens early and stays open late and now we even have early voting as well as absentee ballots. So why doesn’t everyone vote? It is a mystery. But this is a payroll blog not a political one so let’s get on with voting and payroll. By that I mean, what is required of employers when it comes to voting and their employees. Is it mandatory for an employer to allow an employee time off work to vote?

Although most elections are federal in some form or manner there is no federal law that specifies the employer requirements for time off to vote. The federal law protects a person’s right to vote by prohibiting interference with the voting process, including voting, campaigning, or acting as a poll watcher or election official. But actually mandating time off to vote during working hours is another area left up to the individual states. States that have a mandate generally require the employee be given enough time to vote unless there is a certain amount of time available to the employee either before or after the shift to vote. An example of this is for Nebraska which states that the employee must have up to 2 hours unless polls open 2 hours before or after work. This is actually the most common mandate. 15 states require the two hour window. These states include: AK, CO, GA, HI, IL, KS, MD, MA, NE, NM, OK, SD, TX, UT and WA. Six states require a 3 hour window. An example is Arizona which requires up to three hours, unless polls open three hours before or after work. Other states that require the three hour window include IA, MO, TN WI and WV. Two states, AL and WY require only a one hour window and KY and NY have the longest requirements with a four hour window.

But some states are not quite as clear cut on their requirements. For example, NV, mandates “sufficient time” from one to 3 hours depending on the distance from or to the poll. Some states, including AR and CA just state that work hours must be scheduled to allow employees the opportunity to vote. MN requires time necessary to appear at the employee’s polling place, cast a ballot and return to work on the day of the election. MS just requires necessary time to cast a vote. ND encourages employers to provide voting leave when the employee’s regular work schedule conflicts with times polls are open. OH just states “reasonable time”. However many states do not have any provisions concerning voting. These include: CT, DE, DC, FL, ID, IN, LA, ME, MI, MT, NH, NJ, NC, OR, PA, RI and SC. The law in VT permits an employee to be entitled to take an unpaid leave from employment to attend his or her annual town meeting. While VA does not specify a time limit but looks to the starting and ending times of the workday on voting day.

It is important to determine and follow the requirements when it comes to allowing employees time off to vote.