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IRS Conducts Weeklong ‘Paycheck Checkup’ Campaign
During a weeklong summertime campaign (August 13-17, 2018), the IRS encourages employers to remind employees to complete a Paycheck Checkup to ensure the right amount of tax is being withheld from their paychecks.
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Federal
IRS Offers Resources to Understand Tax Reform
The IRS released a tax tip reminding employers about online resources available to help them understand the tax law changes made by the Tax Cuts and Jobs Act (Pub. L. 115-97) [IRS Tax Reform Tax Tip 2018-119, 8-2-18].
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Federal
GAO Report Projects 21% of Taxpayers Are Being Underwithheld for 2018
On July 31, the U.S. Government Accountability Office (GAO) released a report projecting that 21%, or nearly 30 million, taxpayers are having too little tax withheld for 2018. These taxpayers may have a balance due when they file their tax returns and could be subject to a penalty for underpayment of tax [GAO-18-548, Federal Tax Withholding: Treasury and IRS Should Document the Roles and Responsibilities for Updating Annual Withholding Tables, 7-31-18].
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Federal
SSA to Resume Educational Correspondence Notices
The Social Security Administration (SSA) has announced that it will resume sending its Educational Correspondence (EDCOR) notices (also called Employer Correction Request Notices) to employers that file Forms W-2, Wage and Tax Statement, containing name and social security number (SSN) mismatches.
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Federal
IRS Creates ‘Paycheck Checkup’ Flyer
The IRS’s new one-page flyer is designed for employers to give to employees to remind them to complete a Paycheck Checkup [IRS, Publication 5303, Paycheck Checkup, rev. 6-18, posted 7-12-18].
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Federal
SSA Outlines BSO Upgrades for the 2019 Filing Season and Beyond
On July 5, during the IRS’s payroll industry call, Scott Pederson, a Program Analyst in the Social Security Administration’s (SSA) Office of Electronic Services and Technology, provided an overview of some of the changes that SSA has made to its Business Services Online (BSO) suite of services for the 2019 filing season. He also outlined some of some of the changes that SSA would like to make for future years.
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Federal
ETAAC Again Recommends Increasing Electronic Filing of 94x Series
In its Annual Report to Congress, the Electronic Tax Administration Advisory Committee (ETAAC) recommended increasing electronic filing of the Form 94x series and cited the American Payroll Association as a source of information on the project [IRS Publication 3415, Electronic Tax Administration Advisory Committee Annual Report to Congress, rev. 6-18].
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Federal
IRS Offers Year-Round Tax Tips for Taxpayers
The IRS reminds taxpayers that it offers year-round tax help from several sources. This is good information for payroll professionals to pass on to employees who have tax questions. Employees may have more questions this year due to the tax reform law [IRS Tax Tip 2018-91, 6-13-18].
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Federal
IRS Proposal Would Boost e-Filing of Information Returns
The IRS has proposed regulations that would require that all information returns, regardless of type, be taken into account to determine whether a business meets the 250-return threshold that determines whether information returns must be filed electronically [83 F.R. 24948, 5-31-18].
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Federal
IRS Releases Draft 2019 Form W-4 and Instructions
The IRS has released a draft of the 2019 Form W-4, Employee’s Withholding Allowance Certificate, and a draft of the 2019 Instructions for Form W-4. The draft Form W-4 has been substantially revised to comply with the Tax Cuts and Jobs Act (TCJA). Both the way withholding amounts will be calculated and the form that employees will complete will be drastically different beginning in 2019. Employees will be strongly encouraged, but not required, to file a new Form W-4 for 2019.
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Federal
ACA Affordability Percentage Increases to 9.86% for 2019
The IRS released its annual inflation adjustment to the percentage of household income used to determine whether an employer’s offer of health care coverage under the Affordable Care Act (ACA) is affordable. For plan years beginning in 2019, the percentage of household income increases from 9.56% to 9.86% [Rev. Proc. 2018-34, 5-22-18].
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Federal
IRS Announces HSA Limits for 2019
The IRS has announced the 2019 maximum contribution levels for health savings accounts (HSAs) and out-of-pocket spending limits and deductible minimums for High Deductible Health Plans that must be used in conjunction with HSAs [Rev. Proc. 2018-30, 5-10-18].
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Federal
IRS Updates Instructions for Employee Forms to Figure Wage Levies
The IRS created new Notice 1439, Figuring the Amount Exempt From Levy on Wages, Salary, and Other Income – Forms 668-W, 668-W(ACS) and 668-W(ICS), May 2018, that updates instructions for the three versions of Form 668-W, Notice of Levy on Wages, Salary, and Other Income. The updated instructions reflect changes made by the Tax Cuts and Jobs Act (Pub. L. 115-97).
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Federal
IRS Revises Publication 1494 to Adjust Levy Tables for TCJA Changes
On May 1, the IRS released a revised 2018 Publication 1494, which contains changes to the tables showing the amount of wages exempt from federal tax levies caused by the Tax Cuts and Jobs Act (TCJA).
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Federal
IRS Grants Transition Relief for Health Savings Account Contributions
On April 26, the IRS announced transition relief for employers that sponsored Health Savings Account (HSA) qualified plans for their employees for 2018 following guidance issued by the IRS in 2017. The maximum HSA contribution limit for individuals with a family high-deductible health plan remains at the original 2018 level of $6,900 instead of the Tax Cuts and Jobs Act level of $6,850 [Rev. Proc. 2018-27].
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Federal
Payroll Matters to U.S. Tax System
The 2017 Internal Revenue Service Data Book shows that 70% of all federal revenue came through payroll. That number shows the importance of payroll professionals to the integrity of the American tax system.
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Federal
DOL Opinion Letter Answers APA Query Regarding Garnishment of Lump-sum Payments
A new DOL opinion letter says most lump sum payments are considered wages under the Consumer Credit Protection Act, which limits the amount that can be withheld under a garnishment or child support withholding order.
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Federal
IRS Urges Employees to Perform ‘Paycheck Checkup’
In a new national campaign, the IRS is urging employers to direct their employees to perform a “paycheck checkup” because of recent changes to the tax laws [IR-2018-80, 4-2-18].
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Federal
President Trump Signs Budget That Affects IRS, E-Verify, Tip Rules
On March 23, President Trump signed H.R. 1625, the Consolidated Appropriations Act, 2018, which provides funding for the federal government until September 30. The new law affects payroll professionals, including funding the IRS and E-Verify, and changing some tip regulations [Pub. L. 115-141].
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Federal
IRS Posts Sample Notice CP220J for ACA Payments
The IRS has posted a sample of Notice CP220J, which it will use to notify applicable large employers (ALEs) that it has charged them an employer shared responsibility (ESR) payment under the Affordable Care Act (ACA).
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