DC Wage Theft Prevention Act Update

The District of Columbia Department of Employment Security has announced via its website that the recent amendments to the District’s wage-hour law contained in the Wage Theft Prevention Act of 2015 are expected to take effect on February 26, 2015.  The legislation is still pending approval by Congress.  Among the amendments includes the requirement that employers provide a written statement of wage information to employees. The initial notice must contain:

  • The employer’s name
  • Any “doing business as” names used by the employer
  • Physical address of the employer’s main office or principal place of business
  • Employer’s mailing address
  • Employer’s telephone number
  • Employee’s rate of pay and the basis of that rate (by the hour, shift, day, week, salary, piece, commission)
  • Any allowances claimed as part of the minimum wage: tip, meal, or lodging allowances
  • The employee’s overtime rate of pay
  • Exemptions from overtime pay
  • Living wage
  • Exemptions from the living wage
  • Applicable prevailing wages

The notice must be furnished to employees both in English and in the employee’s primary language, and must be signed and dated by the employer and the employee.  The employer must then retain copies of all the notices furnished to the employee for at least three years.  The mayor is supposed to provide a model notice for employers to use.

CT Updates Informational Withholding Filing

The Connecticut Department of Revenue Services is suspending the electronic filing mandate for filing Form CT-W3 for those employers who issue 24 or fewer W-2s. A paper CT-W3 can be filed by employers with 24 or fewer employees for tax year 2014. The due date for the “paper” CT-W3 is February 28.

Also included in the suspended mandate are taxpayers who issue 24 or fewer Forms 1099-R, 1099-MISC, or W-2G. A paper CT-1096 can be filed if the business issued 24 or fewer 1099’s for tax year 2014. The due date for the “paper” CT-1096 is February 28.

Taxpayers are encouraged to use the Taxpayer Service Center (TSC) to electronically file the annual reconciliation of withholding forms. These forms are due March 31, 2015 when filed through the TSC. Taxpayers can key in or upload their annual withholding returns quickly and easily using the TSC. The program gives taxpayers step-by-step instructions for filing.

For assistance with electronic filing, call DRS at 800-382-9463 (outside the Greater Hartford calling area) or 860-297-5962 (from anywhere).

 

OK Resolves the Issue: Who Gets the Taxes When an Employee Telecommutes?

Telecommuting and taxes, taxes and telecommuting. I get questions every day from payroll professionals about withholding state taxes when an employee telecommutes from outside the state.  Do you withhold for the state where the work is sent (the employer state) or where the employee is performing the work (where his or her chair meets his or her backside, to put it crudely).  Several states have what are called telecommuter laws that rely on the so-called “convenience of the employer” laws. These include New York, Delaware, Pennsylvania and Nebraska. It depends on why the employee is telecommuting. If the employee telecommutes out of “employer necessity” then you take the taxes of where the work is performed.  But this is not so easy in New York. Meeting that state’s standards of employer necessity is virtually impossible so you may have to tax the employee twice, once for New York where the employer is located and once for the home state.  This is especially true if the state is located “adjacent to” New York.

But fortunately for payroll professionals Oklahoma has taken the logical approach and confirmed that an employee who moved out of Oklahoma but still works for the same employer by telecommuting is not subject Oklahoma nonresident income tax because the salaries, wages and commissions are for work performed outside of Oklahoma and the employee derives no income from sources within the state of Oklahoma.  Accordingly the employer does not withholding Oklahoma state income tax from the wages.  If only all states were as easy and as logical.

Minneapolis Living Wage Increases

Minneapolis is increased its living wage effective January 22, 2015.  But what exactly is a living wage anyway? Well according to the Harvard Living Wage Fact Sheet from Harvard University it is as follows:

The idea behind a living wage is that people who work in a community should be able to live decently and raise their families in that community. This requires a wage and benefits package that takes into account the area-specific cost of living, as well as the basic expenses involved in supporting a family. Although living wage standards do, by definition, vary by region, they are all considerably higher than the federal minimum wage. This is because the minimum wage does not begin to meet the needs of working people or families anywhere in the country: in fact, it puts a parent with one child below the federal poverty line. A living wage aims to correct this by establishing, at a local level, a more reasonable minimum wage.

There are over 140 living wage rates in the United States in various cities and counties. The living wage ordinance usually applies to a city or county contractor who has a contract with the entity to provide goods, services or construction.  The rate also usually ties in benefits with the amount of the wage. For example in Minneapolis the rate is $12.82 per hour if the employer provides health insurance and $15.16 per hour if they do not.  The logic behind a living wage is that taxpayer money should not be used only to make the business a profit but to also provide the same taxpayers the opportunity for gainful employment.

North Carolina & the Tax Increase Prevention Act

The Income Tax Division recently added a Notice Regarding Effect of Tax Increase Prevention Act of 2014 on North Carolina’s Corporate and Individual Income Tax Returns.

The Notice can be located at:

http://www.dornc.com/taxes/impactoftipa.pdf

Questions about the information provided in this document, can be directed to the Taxpayer Assistance and Collection Center toll-free at 1-877-252-3052 or by mail to the Taxpayer Assistance Division, North Carolina Department of Revenue, Post Office Box 25000, Raleigh, North Carolina 27640-0640.

NC and the Form NC-4 NRA

The Income Tax Division, Personal Taxes Section recently published Important Information About New Form NC-4 NRA. This information supplements information in NC-30, 2015 Withholding Tables and Instructions for Employers, Form NC-4 NRA, Nonresident Alien Employee’s Withholding Allowance Certificate, and Important Notice to Employers and Pension Payers That Withhold North Carolina Income Tax dated December 22, 2014.

This information can be located at:

http://www.dornc.com/taxes/wh_tax/impnotice_nc4nra_012015.pdf

Questions about the information provided in this document, can be directed to the Taxpayer Assistance and Collection Center toll-free at 1-877-252-3052 or by mail to the Taxpayer Assistance Division, North Carolina Department of Revenue, Post Office Box 25000, Raleigh, North Carolina 27640-0640.

CA Adds Sick Leave Section to Wage Theft Form

After January 1, 2015, employers are required to provide most employees with an employee notice (as required under California Labor Code section 2810.5) that now includes paid sick leave information. The revised employee notice form must be used for employees hired after January 1, 2015. For employees hired prior to January 1, 2015, the employer is required to provide a revised employee notice to each employee if compliance with the new paid sick leave law causes a change in the employer’s sick leave policy within 7 days of the change.

Template of Notice

KY Unveils WRAPS

The Kentucky Department of Revenue has launched a new online personal income tax withholding return and payment system (WRAPS). Employers can use WRAPS to file returns (annual, quarterly, monthly, and twice-monthly returns), view and amend previously filed online returns, request refunds, and pay withholding tax using the enterprise electronic payment system.

IRS Releases Info on Third-Party Sick Pay Recap Form

The IRS has released Notice 2015-06 which describes the rules for filing Form 8922, Third-Party Sick Pay Recap. This is an annual form that must be filed with the IRS which replaces the third-party sick pay recaps that were filed with the Social Security Administration. Form 8922 is used to report total amounts of certain sick pay paid to employees by a third party.