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Overtime Rule Appeal and Potential Automatic Updates

Labor Department Plans to File Overtime Appeal

The Labor Department has confirmed it plans to appeal a federal district court’s recent decision to overturn its proposed changes to the overtime rule. The DOL also asked for their appeal to be put on hold while it prepares a new rule. Part of its process for preparing new proposed changes to the overtime may include adjusting the salary threshold for which workers are eligible for overtime.

 

Automatic Update of Overtime Rule Being Considered

Labor Secretary Alexander Acosta announced that he is considering automatically updating overtime pay requirements based on inflation. Acosta also mentioned that a varying salary threshold would be considered to account for regional costs of living.

Representatives of the business community voiced their concerns with this approach as it would alienate the regulated community from ever participating in public debate again regarding salary levels.

Congress Reviews Tax Cuts and Jobs Act

Congress has started its push for tax reform with bills introduced by both the House and Senate (both called the Tax Cuts and Jobs Act). The bills include sweeping changes to the federal tax brackets, proposed elimination of personal exemptions, and higher standard deductions, along with several other payroll-related provisions. If the federal tax code is changed, it will be effective beginning with the 2018 tax year.

On November 29, the tax reform bills were approved by the House. Differences between the House and Senate bills still remain, mainly regarding the federal individual income tax rates and the number of tax brackets.

For more information on the Tax Cuts and Jobs Act, check out our blog post.

ACA Employer Mandate Penalty Letters Coming

The IRS will be assessing Affordable Care Act (ACA) employer mandate penalties, set to begin before the end of 2017. The IRS has released information detailing how employer penalties will be assessed and how they can be contested. A sample letter has also been released, describing the procedure that will be used to assess penalties. The first letters will be issued in late 2017 for 2015 calendar year penalties.

For more information, please visit the IRS website.

2017 FUTA Credit Reductions

Employers in two jurisdictions will pay higher payroll costs for 2017 because of FUTA credit reductions:

  • California - 2.1 percent
  • U.S. Virgin Islands - 2.1 percent

The FUTA tax credit reduction is assessed at the end of each year for states who have an unpaid loan balance for unemployment benefits. This reduction decreases the amount of FUTA credit an employer can claim per employee when filing taxes. For more information, visit our FUTA Credit Reductions page.

Form 940 FUTA Return for 2017 Released

The 2017 Form 940 has been released. The Employer’s Annual Federal Unemployment (FUTA) Tax Return form Schedule A and instructions have also been released. The deadline for filing and paying remaining amounts of federal unemployment tax owed for 2017 is January 31, 2018. Employers may file Form 940 electronically through the Modernized e-file (MeF) system.

2018 SSA Wage Base Decreased

The Social Security Administration (SSA) has lowered the 2018 Old-Age, Survivors and Disability Insurance (OASDI) taxable wage base from $128,700 to $128,400. This change was a result of a large payroll provider submitting 500,000 corrections for 2016 W-2s that impacted the SSA wage base.

Based on the new amount, the maximum 2018 OASDI portion of the Federal Insurance Contributions Act (FICA) tax payable by each employee is $7,960.80, or 6.2 percent of the wage base. Employers match the employee amount with an equal contribution. There were no changes to cost-of-living adjustments.

OSHA Electronic Reporting Deadline Set

OSHA has published its final rule pertaining to electronic filing, setting the deadline for December 15, 2017. Employers who are subject to OSHA tracking and reporting will submit 2016 forms electronically by this date. The deadline applies to:

  • Establishments with 250+ employees that are currently required to track and report OSHA injury and illness records.
  • Establishments with 20 to 249 employees in certain high-risk industries.
The original electronic filing deadline was July 1, 2017, but OSHA announced a delay to the deadline back in May. The proposed OSHA rule then set a tentative deadline of December 1, but this date was pushed back to December 15 in the final OSHA ruling.

Compliance Schedule

The new reporting requirements will be phased in over the next two years:

  • Establishments with 250+ employees that are currently required to track and report OSHA injury and illness records will submit 2017 forms (300A, 300, and 301) by July 1, 2018. Beginning in 2019 and thereafter, the forms must be submitted by March 2.
  • Establishments with 20-249 employees in certain high-risk industries will submit Form 300A for the 2017 year by July 1, 2018. Beginning in 2019 and thereafter, Form 300A will be submitted by March 2.

2018 State UI Wage Base Updates

The Clock is Ticking...It's Time for Year-End

Don’t be late for a very important date! Download our Year-End Payroll and HR Guides before time is out.
Increases to the SUTA wage bases for 2018 have been announced by 13 states:

  • Colorado: $12,600
  • Idaho: $38,200
  • Iowa: $29,900
  • Montana: $32,000
  • Nevada: $30,500
  • New Jersey: $33,700
  • New York: $11,100
  • North Carolina: $23,500
  • Ohio: $9,500
  • Oregon: $39,300
  • Pennsylvania: $10,000
  • Utah: $34,300
  • Vermont: $17,600
  • Washington: $47,300
Six states have announced decreases to their unemployment taxable wage base for 2018:

  • Arkansas: $10,000
  • Delaware: $16,500
  • Missouri: $12,500
  • New Mexico: $24,200
  • Oklahoma: $17,600
  • Wyoming: $24,700

For more information and updates, visit our SUTA Wage Bases page.

2018 State Standard Deduction Increases

The following states have announced increases to standard deductions next year:

  • Missouri: $6,500 from $6,350
  • Oregon: $2,215 from $2,175

New York On-Call Scheduling

Proposed changes to call-in pay regulations have been presented to the New York State Registrar for review. The changes would required employers to pay workers four hours of call-in pay for shifts canceled within 72 hours of when they were to start. This would apply to workers who must be on-call and available to report to work for any shift and to employees who must be in contact with their employer within 72 hours of the start of shift to confirm whether or not to report for work.

Nevada Cancels 4th Quarter UI Bond Assessment

Effective Q4 of 2017, Nevada’s bond assessment is not in effect. Employers with an outstanding bond assessment balance will continue to receive notices and monthly interest due until the balance is paid.

NOTE: APS will be issuing refunds for any clients we have drafted funds from so far this quarter.

Ohio Now Requires Electronic UI Filing

Employers are required to file unemployment tax and wage reports electronically starting January 1, 2018. For more information, please visit the Ohio Department of Job and Family Services.

How APS Can Help

APS provides cloud-based solutions for Core HR and Payroll processes to provide organizations with the technology the need to be more productive and efficient. Our self-service technology for employees and managers makes it easier for HR managers to delegate responsibility while maintaining accountability. By maintaining a vision of unified systems that make human capital management nearly effortless, we support our clients in their growth and success.

To learn more, please visit our website at www.apspayroll.com or call 855-945-7921.

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