New York Metropolitan Chapter of the APA Roundup of State Payroll Developments Presented by Laura Lough, Esq. and Lia

1. New York Metropolitan Chapter of the APARoundup of State Payroll DevelopmentsPresented by Laura Lough, Esq. and Lia Coniglio, Esq. December 1, 2011

2. Bios Laura Lough, Esq. Senior Manager of State Payroll Information Resources for APA Co-author of APA’s Guide to State Payroll Laws and APA’s Guide to Local Payroll Taxes. Managing Editor of PayState Update, APA’s state and local payroll compliance e-newsletter. Contributes to other APA publications, such as Paytech and Payroll Currently, and course books. Graduated from the State University of New York at Geneseo and Western New England University School of Law. Member of the NY and MA Bars. Lia Coniglio, Esq. Editor of Payroll Information Resources for APA Co-author of APA’s Guide to State Payroll Laws and APA’s Guide to Local Payroll Taxes. Writes and edits PayState Update, along with other APA publications, such as APA’s Guide to Federal and State Wage & Hours Laws, and course books. Graduated from the State University of New York at Buffalo and Albany Law School. Member of the NY Bar. About the Speakers

3. Pennsylvania Act 32 Changes EIT collection system Fully implemented 1-1-12 Standard forms, proposed regs Withhold higher rate Where employee lives (resident rate) vs. where employee works (nonresident rate) Filing & payments Quarterly or monthly (electronic) Annual reconciliation return & Forms W-2 Local Payroll Taxes

4. Wage Theft Prevention Acts New York Pay rate notices must be given to all employees by 2-1-12 Yearly AND at time of hire thereafter California Pay rate notices must be given at time of hire only, beginning 1-1-12 Not required for employees exempt from overtime requirements Labor Law

5. Latest Developments Standard forms IWO – revised in May NMSN – revised in March Verification of Employment Response – new e-IWO portal Transmit IWO info between employers & states Lump sum payments Debt inquiry service Child Support

6. Paid Time Off Bank Employer prohibited from making deductions from employee’s paid time off bank to recover an overpayment of wages Even if it is employer’s policy to do so Opinion letter issued on 2-4-11 Available on state DOL website at www.labor.ny.gov Note: NY DOL no longer issues individual opinion letters Wage Deductions in New York

7. Health Care for Adult Children Health coverage for employee’s child is tax-free until year child reaches age 27 Federal law, eff. 3-30-10 Not all states followed fed tax treatment Wisconsin last state to conform Governor signed legislation 11-4-11 Effective beginning with tax year 2011 Department of Revenue guidance FMV of benefit no longer imputed income Benefits

8. Withholding Changes Proposed changes reflect expiration of “millionaire’s tax” on 12-31-11 Effective 1-1-12, highest state tax rate will again be 6.85% Temporarily increased in 2009 to 8.97% for filers earning over $500,000 per year Supplemental wage tax rates Effective 1-1-12, state rate will decrease to 7.65% from 9.77% Yonkers rate will decrease to 1.1475% from 1.70975%. New York & Yonkers

9. New York Tax Treatment Same-sex marriage legal in NY Governor signed legislation eff. 7-24-11 No NYS, NYC, Yonkers withholding on value of certain benefits for same-sex spouse, children Same-sex marriage legal in other states CT, DC, IA, MA,NH, VT Federal government does NOT recognize same-sex marriage Benefits subject to FIT reporting, withholding Same-sex Marriage

10. UI Trust Fund Insolvency As of 11-15-11, 27 states/territories have outstanding loans from the Federal Unemployment Account (FUA) Check for updates on federal DOL website at http://workforcesecurity.doleta.gov/unemploy/ budget.asp#tfloans States use loans to pay UI benefits Interest on these FUA loans came due this year NY employers received interest assessment surcharge that was due on 8-15-11 State Unemployment Insurance

11. FUTA Credit Reduction States 21 states/territories are FUTA credit reduction states for 2011 Most states face a reduction of 0.3% AR, CA, CT, FL, GA, IL, KY, MN, MO, NV, NJ, NY, NC, OH, PA, RI, VI, VA, & WI Indiana – 0.6% (2nd consecutive year) Michigan – 0.9% (3rd consecutive year) South Carolina – NO reduction in 2011 IRS Form 940, Schedule A State Unemployment Insurance

12. GA: Only Lawyers Can Answer Georgia Supreme Court decision 9-12-11 Non-lawyer cannot answer garnishments Must use Georgia attorney. If not: Answers returned by court clerk Default judgment, employer pays debt APA’s GATF Garnishment Subcommittee Proposed legislation in 2012 Creditor Garnishments

13. Updates on UI, TDI, FLI &Employee Notice Requirements 2012 taxable wage base = $30,300 2012 employee contribution rates UI = 0.425% ($128.78 max) TDI = 0.2% ($60.60 max) FLI = 0.08% ($24.24 max) Employee Notice Requirements Employers required to keep payroll records must post notice Notice available on Department of Labor & Workforce Development’s website: http://lwd.state.nj.us/labor/forms_pdfs/EmployerPosterPacket/MW-400.pdf New Jersey

14. Catch-up Withholding Retro. 1-1-11, PIT rates increased Catch-up withholding tables & calculation rules eff. 8-1-11 Problems for payroll software New Form CT-W4T, 2011 Withholding Certificate Eff. 1-1-12, revised withholding calculation rules issued Connecticut

15. Recent Changes Claims Resolution Act New data element to be reported First day of work Eff. 6-8-11 with additional time for states NY revised Form IT-2104 Trade Adjustment Act Affects rehired employees 60 consecutive days Eff. 4-21-12 with additional time for states New Hire Reporting

16. State & City Developments Connecticut Eff. 1-1-12, employers with 50 or more employees must provide paid sick leave annually to service workers Accrue 1 hour of paid sick leave for every 40 hours worked, up to 5 days of paid sick leave a year. Seattle Eff. 9-1-12, employers must provide paid sick leave with accrual rates based on the number of employees at the company Paid Sick Leave

17. Thank You