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July, 2019

APS July 2019 Compliance Updates

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July 2019 Compliance Updates

APS reports on relevant, impactful compliance updates each month to help keep you at the top of your compliance game. Updates this month include state and local changes as well as updates to state unemployment wage bases. Here are your July compliance updates:

Tax Transcripts

IRS RELEASES NEW WITHHOLDING FORMS

The Internal Revenue Service announced the 2020 version of the Employee’s Withholding Allowance Certificate (Form W-4) will be released late July 2019. The new version of the Form W-4 will no longer allow withholding allowances.

Minimum Wage

MINIMUM WAGE BILL PASSES IN HOUSE

On July 18, 2019, the House passed legislation that would increase the minimum wage to $15 an hour by October 1, 2025, in several phases. The Raise the Wage Act also increases wages for those under the age of 20 to $5.50 an hour, those who work for tips to $3.60 an hour, and those with disabilities to $4.25 an hour. The bill will also replace these subminimum wages with the new federal minimum wage.

Wage Bases

2020 STATE UNEMPLOYMENT WAGE BASES

Three states have announced their unemployment taxable wage bases for 2019. The following states have SUTA wage base changes for 2019 and 2020:

  • Iowa - $31,600
  • Wyoming - $26,400
  • Tennessee - $7,000 (2019)
Minimum Wage Changes

2020 MINIMUM WAGE CHANGES

One state has announced changes to its minimum wage rates beginning January 1, 2020:

  • Alaska - $10.19
Tax Rates

EEOC STARTS EMPLOYEE DATA PAY SURVEY & FAQS

EEOC Starts Employee Data Pay Survey

The Equal Employment Opportunity Commission (EEOC) started collecting data on employee pay on July 15, 2019, through their online portal. Login information for the survey was sent to employers with over 100 employees on July 15, 2019, via email and mail. Employers are now required to submit their data from the fourth quarter pay periods of calendar years 2017 and 2018.

New Frequently Asked Questions Added to EEOC Pay-Data Survey

The EEOC announced July 23, 2019, that new FAQS were added to their Pay-Data Reporting resource page to aid employers.

Unemployment Tax Rates

2019 & 2020 STATE UNEMPLOYMENT TAX RATES

The following states have announced their 2019 and 2020 unemployment tax rates:

New Jersey

New Jersey’s unemployment tax rates for 2020 will be the following:

  • 0.4 percent to 3 percent for positive-rated employers
  • 4.3 percent to 5.4 percent for negative-rated employers
  • 2.8 percent for new employers

Tennessee

Tennessee’s unemployment tax rates for the second half of 2019 will be the following:

  • 0.01 percent to 2.3 percent for positive-rated employers
  • 5 percent to 10 percent for negative-rated employers
Kentucky

KENTUCKY COUNTIES RAISE OCCUPATIONAL TAX RATES

Simpson and Bathe Counties announced they will increase their occupation tax rate one and two percent, respectively, and remove the social security wage gap cap. These changes are expected to go into effect on July 1, 2019.

Massachusetts

MASSACHUSETTS MANDATES NOTIFICATION OF CHANGES TO EMPLOYEE LEAVE CONTRIBUTIONS

All Massachusetts employers who notified their employees of the paid leave contribution program before the June 14, 2019 delay announcement, must now notify their employees every time there is a change by September 30, 2019.

Oregon

OREGON LAWMAKERS PASS NEW PAID FAMILY AND MEDICAL LEAVE MEASURE

Oregon lawmakers passed the measure (HB 2005) on June 30, 2019, for paid family and medical leave for the majority of the state’s employees. Employers with over 24 employees are required to participate with contributions that are not to exceed one percent of wages. It is projected to collect $775 million from employers and $1.5 billion from employees between 2023-2025. The law is set to become effective Jan 1, 2022, with benefits being accessible starting the following year.

Yonkers

YONKERS, NEW YORK EXTENDS INCOME TAX SURCHARGE DEADLINE

New York lawmakers signed a bill (A. 6694) that will extend the deadline income tax surcharge of wages for residents of Yonkers, New York and individuals who work there until December 31, 2021.

Connecticut

CONNECTICUT GOVERNOR VETOES REGULATING TIPPED-WAGES BILL

Connecticut Governor Ned Lamont vetoed a bill (Public Act 19-198) that would allow employers to apply a tip credit to non-service jobs. Currently, the state only allows a tip credit to be applied to service jobs which include: taking orders, delivering food and beverages, removing dirty plates and silverware, and preparing the table for the next guests.

Non-service jobs are considered washing dishes, cleaning restrooms, performing host/hostessing duties, setting up or breaking down a restaurant after hours, and more. Governor Lamont believed the bill would diminish employee’s right to retrieve wages.

Minnesota

MINNESOTA SET TO PENALIZE EMPLOYERS FOR WAGE VIOLATIONS

Governor Tim Walz signed a budget allowing employers to be penalized for workers pay violations. The Department of Labor will now have investigators that can subpoena records and testimony from employers and enter businesses during business hours to investigate possible violations.

New York

NEW YORK FARM WORKERS OBTAIN PROTECTIONS

New York’s governor passed a measure (A.B. 8419) that requires farmworkers to receive a 24-hour day off once a week, overtime compensation, paid disability, paid family leave, and unemployment benefits. Farmworkers can choose to work on their day off for overtime pay. Notice of new law must be posted in an open area in English and Spanish at the place of business. This measure will take effect on January 1, 2020.

Missouri

MISSOURI TAX FILING EXTENSIONS & TAX FILING THRESHOLD

Missouri Granted Tax Filing Extension

The IRS announced employers have received an extension for filing and payment of business tax returns in the following counties: Andrew, Atchison, Boone, Buchanan, Carroll, Chariton, Cole, Greene, Holt, Jackson, Jasper, Lafayette, Lincoln, Livingston, Miller, Osage, Pike, Platte, Pulaski, and St. Charles. The Tax filing deadline has been extended to August 31, 2019.

Missouri Drops Threshold for Tax Filings

Governor Mike Parson passed a bill (S.B. 90) that will reduce the requirement of employers with 250 employees to file unemployment taxes and wage reports to employers with 50 employees. This measure takes effect on August 28, 2019, and employers will be required to submit reports starting with the first quarter of 2019.

Income Tax

OHIO SCHOOL DISTRICT & MUNICIPALITY INTRODUCE INCOME TAX

Ohio School District Introduces Income Tax

Alexander school district will now have an income tax rate of 1 percent starting January 1, 2020. The measure passed in May’s primary election.

Ohio Municipality Set to Pass New Income Tax

According to a newly released ordinance, Belmont County’s municipality of Bridgeport is expected to pass a new income tax law with an initial rate of 1 percent and excludes credit for taxes paid to other.

Wisconsin

WISCONSIN'S WITHHOLDING METHODS & INCOME TAX BILL

Changes in Wisconsin’s Withholding Methods

The state’s governor passed a bill that changes withholding methods to now include tax cuts starting 2020. The budget also decreases its second-lowest tax bracket to 5.21 percent. The new budget will be effective from July 1, 2019, to June 30, 2021. This new requirement will take effect starting April 1, 2020.

Income Tax Bill Passes In Wisconsin

Wisconsin’s governor signed a related bill (A.B. 25) that mandates the state to offset the income tax rates based on revenue gained from the out-of-state retailer’s sales tax.

San Antonio

NEW LAWSUIT CHALLENGES PAID SICK LEAVE IN SAN ANTONIO

A group of businesses in San Antonio is suing the city of San Antonio over mandated paid sick leave. The group believes the law violates Texas minimum wage law and legislature did not follow correct procedures for passing an ordinance. San Antonio’s mandate is set to take effect starting on August 1, 2019.

Pittsburgh

PITTSBURGH SUPREME COURT OVERRULES ON PAID SICK LEAVE MEASURE

The Supreme Court in Pittsburgh rules that mandated paid leave is lawful under the Disease Prevention and Control Law. The law requires employers with more than 15 employers to offer 1 hour of paid leave for every 35 hours worked with a cap at 40 hours of paid leave and employers with fewer than 15 workers can cap at 24 hours of paid leave.

Ohio

OHIO PASSES BUDGET IMPACTING TAX RATES AND BRACKETS

Ohio’s new budget has eliminated the lowest two of its seven tax brackets. The new budget will take effect July 1, 2019, and run through January 1, 2021. The new tax bracket has decreased rates to the following: 2.85 percent, 3.326 percent, 3.802 percent, 4.413 percent, and 4.797 percent.

Chicago

CHICAGO PASSES NEW SCHEDULING ORDINANCE

Chicago’s city council passed their new Fair Workweek Ordinance that will require employers to post their employees’ work schedule 10 days in advance starting July 1, 2020. The ordinance is meant to protect workers from unfair scheduling by their employers. The measure covers the building services, health care, hotels, manufacturing, restaurants, retail, and warehouse services industries. If the ordinance is violated, employers face up to a $500 fine.

Maine

MAINE CONSIDERS PAY CARDS UNCLAIMED PROPERTY

Beginning October 1, 2019, employers must file unclaimed paycards as unclaimed property in the state of Maine. If the paycard is not claimed within three years, it is considered abandoned.

How aps can help

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Businesses choose APS as their workforce partner because of our focus on the customer experience. As a result, we continually maintain 98% customer retention and satisfaction rates.

For more information on how we can help make payroll and HR easier for your business, please visit www.apspayroll.com or call 855-495-7921

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