Updates

IRS Update: Tax Withholding Estimator, Lock-In Letters & 2020 W4

IRS Offers Guidance on Lock-In Letters The IRS updated its Withholding Compliance Questions & Answers page to offer guidance on how to handle lock-in letters with the new Form W-4. Understanding the 2020 Form W – 4 and How to Use it to Calculate Withholding IRS webinar On-Demand Topics covered: the reason for new a design of the W-4 walk through each of the five steps on the new form explain who is required to use the new 2020 form discuss Publication 15-T show how to complete two of the five available worksheets Video IRS Updates Tax Withholding Estimator for 2020 The IRS released a new version of its tax withholding estimator, which it states is “designed to help workers target the refund they want by having the right amount of federal income tax taken out of their pay.” ...

USCIS Releases New Form I-9 & Instructions

USCIS released a new version of Form I-9, Employment Eligibility Verification on January 31, 2020. Employers should begin using the new version of Form I-9 at this time. Use of the new Form I-9 becomes mandatory starting May 1, 2020. ******** Need to Know: Grace period for using the prior version of Form I-9 through April 30, 2020. Mandatory use of new Form I-9 as of May 1, 2020 Download the new Form I-9: https://www.uscis.gov/i-9 Applies to new hires and re-verification of employment authorization for existing employees What’s Changed: Form – Added Eswatini and North Macedonia to the Country of Issuance field in section 1 and the foreign passport issuing authority field in section 2 per those countries’ recent name changes. Instructions – Clarified that an authorized representative ...

USDOL issues final rule on FLSA Regular Rate of Pay

Under the Fair Labor Standards Act (FLSA) and long-standing regulations, the regular rate of pay that is used in computing overtime pay includes more than just the employee’s base pay—it can include cash and non-cash bonuses and perks. Determining which added payments and perks to consider in the overtime pay calculation can be confusing for employers. For this reason, the US Department of Labor (DOL) issued a final rule on December 12, 2019 that it believes better clarifies the definition of regular pay for overtime calculation purposes thereby making it easier for employers to identify perks that can be disregarded in connection with overtime pay. The DOL states that this is the first significant update to the regulations governing the regular rate requirements in over 50 years. The fina...

New employer requirements starting Jan. 1, 2020

Minnesota minimum-wage rates increase The following are Minnesota’s minimum-wage rates as of Jan. 1, 2020. Large employers must pay at least $10 an hour when the employer’s annual gross revenues are $500,000 or more. Small employers must pay at least $8.15 an hour when the employer’s annual gross revenues are less than $500,000. The training wage rate, $8.15 an hour, may be paid to employees younger than 20 years of age for the first 90 consecutive days of employment. The youth wage rate, $8.15 an hour, may be paid to employees younger than 18 years of age. Employers can print or order a free copy of the required minimum wage poster by visiting DLI’s website. Employee notice updates may be required New this year, as part of Minnesota’s employee notice requirem...

Minnesota revised 2019 withholding tables released

The Minnesota Department of Revenue released revised 2019 withholding wage-bracket tables and the computer formula that reflect legislation enacted earlier this year (HF 5). Under the law, the second-tier income tax rate bracket is reduced from 7.05% to 6.8% and the income tax brackets for all tiers are adjusted. Employers should begin using the updated tables as soon as possible, but there is no need to retroactively apply the revisions to state income tax already withheld. The withholding tables and computer formula are updated to reflect changes to the standard deduction, exemptions, and rates. The Department’s Withholding Tax Calculator is also revised to reflect the income tax table changes. The Department suggests that employees consider submitting a new Form W-4MN, Minnesota Employe...

Reminder: EEO-1 Is Due by September 30, 2019

On September 29, 2016, the EEOC announced that it would collect summary pay data from certain employers for the first time as part of the Employer Information Report (EEO-1) for 2017 that was due on March 31, 2018. However, before the report was due, the Office of Management and Budget issued a memorandum blocking the revisions indefinitely. On May 3, 2019, a federal district court ruling reinstated the pay data requirement. Even though the court case reinstating the pay data requirement has been appealed, employers are still required to provide pay data for 2017 and 2018 by September 30, 2019. With some exceptions, private employers with 100 or more employees and federal contractors with 50 or more employees must complete an EEO-1 report each year. Covered employers already provide demogr...

IRS releases draft Form W-4 for 2020

The IRS issued the first draft release of the Form W-4 for 2020. In the next few weeks, the IRS plans to issue draft instructions for employers and will request comments from the business community at that time. The revised form implements changes made following the 2017 Tax Cuts and Jobs Act, which made major revisions affecting taxpayer withholding. The redesigned Form W-4 no longer uses the concept of withholding allowances, which was previously tied to the amount of the personal exemption. Due to changes in the law, personal exemptions are currently not a central feature of the tax code. The IRS and Treasury collected extensive feedback over the past year while working closely with the payroll and tax community to develop a redesign that best serves taxpayers. The IRS expects to releas...

MSST: “Non-resident” employers and their employees

The Minneapolis Sick and Safe Time ordinance took effect July 1, 2017. Previous litigation temporarily suspended enforcement against “non-resident” employers. However, the effective date of July 1, 2017 remains unchanged. Following a recent court ruling, the Department of Civil Rights has the responsibility to fully enforce the law. All covered employees, including employees of “non-resident” employers, are entitled to accrued sick and safe time based upon hours worked in the City of Minneapolis since July 1, 2017. Employers must provide covered employees with accrued sick and safe time accordingly. The Department of Civil Rights may exercise some enforcement discretion during summer 2019 as “non-resident” employers act in good faith to promptly comply. An employee is covered i...

IRS warns of “Tax Transcript” email scam; dangers to business networks

WASHINGTON – The Internal Revenue Service and Security Summit partners warned the public of a surge of fraudulent emails impersonating the IRS and using tax transcripts as bait to entice users to open documents containing malware. The scam is especially problematic for businesses whose employees might open the malware because this malware can spread throughout the network and potentially take months to successfully remove. This well-known malware, known as Emotet, generally poses as specific banks and financial institutions in its effort to trick people into opening infected documents. The Summit partnership of the IRS, state tax agencies and the nation’s tax industry remind taxpayers to watch out for this scam. However, in the past few weeks, the scam masqueraded as the IRS, pretending to...

Minimum wage in Minnesota

Minimum-wage rate will be adjusted for inflation on Jan. 1, 2019 Minnesota’s minimum-wage rates will be adjusted for inflation Jan. 1, 2019, to $9.86 an hour for large employers and $8.04 an hour for other state minimum wages. Under Minnesota law, the commissioner of the Department of Labor and Industry is required to determine and announce the inflation-adjusted minimum-wage rate each year by Aug. 31. This year, the change in the price index used for this purpose is an increase of 2.16 percent.  Read news release here. Minimum-wage rates Provision Amount as of Jan. 1, 2018 Amount as of Jan. 1, 2019 Large-employer wage $9.65 an hour $9.86 an hour Small-employer wage $7.87 an hour $8.04 an hour 90-day training wage (under 20 years of age) $7.87 an hour $8.04 an hour Youth wage (under ...

Building a Digital Defense Against Payroll Phishing Scams

The FBI’s Internet Crime Complaint Center is out with a new warning about fraudsters who are targeting your paycheck via direct deposit. Any worker can be affected by this scam, but the industries getting hit the hardest include education, health care, and commercial airway transportation. Here’s what happens: the bad guy uses your work login info to get into your employer’s HR system to replace your direct deposit information with his own. It starts when an employee receives an email that looks just familiar enough that he doesn’t question it too much. The email includes a link or web address that the user clicks on. Once he clicks, he will be directed to a fraudulent site or portal where the victim will be asked to enter his work credentials to confirm his identity. The bad guys use that...

Minnesota Department of Revenue Updates 2019 Filing Season

Minnesota Department of Revenue Updates 2019 Filing Season for Tax Year 2018 FAQ Since the end of the 2018 Legislative Session, the Minnesota Department of Revenue has been working to update the state tax filing systems for taxpayer use in 2019. This process happens annually, starting after the end of the legislative session. This year, they are updating the tax filing systems to accommodate the differences between the federal and Minnesota tax laws.  There were significant revisions to the federal tax laws, but Minnesota’s tax laws have not significantly changed. As they update the tax system to accommodate the differences between federal and Minnesota tax laws, they are gathering your frequently asked questions about the 2019 filing season. They have updated our their website’s Tax Law C...

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