11th Annual 2004 PayChoice Users Conference • Payroll Industry Update • Chuck Culver & Jim Costello
Payroll Industry Update • Influence of The WEB in Payroll/HR Continues to Grow – • Protecting Employee Information - • H.R. 1528 – Good Government Tax Act - • Check 21 – Check Clearing for the 21st Century Act - • Employee Name/SS# Matching – What You Need to Know • Federal & State E-file and EFTP Continues to Grow
Payroll Industry Update • WEB Influence in Payroll/HR Continues to Grow – • 20,000+ PayChoice Clients do Payroll on the WEB • SHRM Predicts All HRIS System Online by 2010 • Business DSL, Cable and T1 Access Up by 23 % • ADP, PayChex & Ceridian All Increase WEB Use • Major Time & Attendance Vendor Building for WEB
Privacy of Information • H.R.2971 • Social Security Privacy and Identity Theft Act. • Limits Display of SSN # • Can’t deny service (unless required by law) • Requires Electronic Encryption • Fines $5000 to $250,000 per incident • Five Years imprisonment
Privacy of Information • Other Legislation • The Gramm-Leach-Bliley Act • HIPAA, Privacy of Health Information • The Patriot Act • The Homeland Security Act • And the List goes on
Privacy of Information • Security of Employee Data Must be a Top Priority • PAI has already Instituted Masking SSN# • We continue to upgrade our Firewall protection. • Are re-evaluating overall security efforts constantly.
Privacy of Information • Anne Clifford • Senior Human Resource Executive • Committee member of IHRIM Privacy and Security Special Interest Group since 1998 • Employee Privacy Workshop • 10:30 -12:00 Friday
Payroll Industry Update H.R. 1528 – Tax Administration Good Government Act • The original reason that Tax Preparer regulation was introduced, will never happen according to IRS. • American Payroll Association, IPPA and Payroll Associates, Inc feel that this bill is un-necessary and onerous. • This bill is still in conference committee (On Election break) but has been passed by the House and Senate. • Different groups representing the payroll industry and the tax preparers industry are attempting to influence changes to this legislation.
to require the registration of Federal income tax return preparers, refund anticipation loan providers, and payroll agents
to require the posting of a reasonable bond by each registered payroll agent.`
to an applicant for registration must not have demonstrated any conduct that would warrant disciplinary action. the Secretary shall minimize the burden and cost on the registrant
The Secretary shall require that each applicant for registration pass an initial examination testing the applicant's technical knowledge and competency to prepare individual and business Federal income tax returns.
require an annual renewal of registration and shall set forth the manner in which a registered Federal income tax return preparer, refund anticipation loan provider, or payroll agent must renew such registration.
each registrant pass an annual refresher examination (including tax law updates). payment of reasonable fees for registration and for renewal of registration be subject to a $500 penalty for each incident of noncompliance
Treasury shall conduct a public information and consumer education campaign, utilizing paid advertising, to inform the public of the requirements that Federal income tax return preparers.
Treasury shall maintain a public list (in print and electronic media, including Internet-based) of Federal income tax return preparers. The Secretary of the Treasury shall notify any taxpayer if such taxpayer's return was prepared by such an unregistered Federal income tax return preparer .
Payroll Industry Update H.R. 1528 – Tax Administration Good Government Act If it happens, when will it be enacted? When will it go into effect? “Payroll Agent” Amendments to HR 1528: Proposed Revisions
Payroll Industry Update • Check 21 – Check Clearing for the 21st Century Act - • Goes Into Effect Today! • Check 21 allows any institution that handles a check to convert it into an electronic record and destroy the original document. • The changes will likely cause a loss of float and increase the incidence of bounced checks. • Bank of America and KeyBank spearhead pilot projects to convert checks now to electronic. • Most large banks will follow suit in the months ahead. • Under Check 21, most checks will now clear within 24 hours and by overnight within a year.
Payroll Industry Update Employee Name/SS# Match, What You Need to Know Existing Employees: 1. Do an annual solicitation of SS#’s via new W-4 2. Validate SS# via SSA Web site Go Towww.socialsecurity.gov/employer/ssnv.htm 3. Follow up – Write/email employee a letter to request proof or correction of SS#. New Employees: 1. Ask to see Social Security Card with new W-4 Read Pub. 1586-www.irs.gov/pub/irs-pdf/p1586.pdf.pdf
Payroll Industry Update • Federal & State E-file and EFTP Continues to Grow • Federal 941/940 e-file could be mandatory under H.R. 1528. • Bank of America takes over all EFTPS • More states turn to return e-file in 2005 • More states accept UC EFT at EOQ • More PAI Licensees use UC Mag. Media • Review SSA 2004 Mag Media Changes
Payroll Industry Update Thank You