January 1, 2011 Sage Accpac Payroll Tax Update Available

Posted by EQ Tech on Wed, Dec 29, 2010

SAGE ERP ACCPAC
PAYROLL TAX UPDATE INFORMATION


Tax Table Updates for U.S. payroll customers for Jan 1, 2011 is now available for download. All companies that run US Payroll must install this update since there are Federal changes.

Federal Income Tax Changes 
The IRS has released new percentage method tables for wages paid in 2011. (Effective 1-1-2011) 

Federal Earned Income Credit (EIC)
Effective January 1, 2011, the advance earned income credit (EIC) which allowed qualified individuals to receive part of the credit in each paycheck during the year the taxpayer expects to qualify for the credit has been eliminated. As a result, the tax tables, payroll codes, and associated property codes for the federal advanced EIC have been expired.

Please remove the USEIC code from the employee setup. The calculated USEIC has been set to zero effective Jan 1, 2011. Refer to the Update Notice for more details.

Social Security Wage Base Change
The employee rate is being adjusted from 6.2% to 4.2%.
The Social Security wage base is unchanged for 2011 at $106,800. (Effective 1-1-2009)

State (or Local) Income Tax Changes
This tax update contains changes in the state (or local) income tax withholding tables for the following, effective January 1, 2011, unless otherwise noted:

Arizona
California
Kentucky
Maine
Michigan
Minnesota
New York City
Rhode Island

For details of the changes, please refer to the publications issued by your Department of Revenue.

Arizona: Starting Jan 1, 2011 the state has removed all compensation requirements. Therefore, all rates are available for all compensation levels. The Required Rate option is available and the rate is unchanged from the previous tax update. If you have any employees using this option please adjust it to the selection on their Arizona A-4 Form or you may have employees that are underwithheld.

Lousiana: The married status for 0 or 1 personal exemptions has been adjusted to read the single table for 0 or 1 personal exemptions. 

SUTA Wage Base Changes

Tax Year
2011
2010
Alaska
34,600
34,100
Hawaii
34,200
34,900
Illinois
12,740
12,520
Indiana
9,500
7,000
Iowa
24,700
24,500
Mississippi
14,000
7,000
Montana
26,300
26,000
Nevada
26,600
27,000
New Hampshire
12,000
10,000
New Jersey
29,600
29,700
New Mexico
21,900
20,800
North Dakota
25,500
24,700
Oklahoma
18,600
14,900
Oregon
32,300
32,100
South Carolina
10,000
7,000
South Dakota
11,000
10,000
Utah
28,600
28,300
Vermont
13,000
10,000
Washington
37,300
36,800
Wisconsin
13,000
12,000
Wyoming
22,300
22,800

Alaska: The employee rate has changed from 0.5% to 0.58% for 2011.

State Disability Insurance (SDI) Changes
The State Disability Insurance (SDI) has changed for:

California:
The taxable wage base limit remains at $93,316.
The SDI rate for employees increases from 1.1% to 1.2%.
The maximum amount to withhold for each employee in 2011 is $1119.79.

Hawaii:
The maximum weekly wage base limit has changed from $901.70 to $884.29.

New Jersey:
The taxable wage base limit has changed from $29,700 to $29,600.

Rhode Island:
The taxable wage base limit has changed from $57,900 to $58,400.
The SDI rate for employees has changed from 1.2% to 1.3%.

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Important information regarding W-2 reporting
If you have HIRE Act exempt employees and are reporting for 2010, do not change the USSS HIRE Act Exempt Employee status to No. If you change the status to No, then the HIRE Act Exempt employees will not be correctly reported on the W-2. The HIRE Act's social security exemption has not been extended, so it does not apply to any wages paid after December 31, 2010.

The Social Security for the Employer (USSS) will be calculated starting Jan 1, 2011 even if the HIRE Act Exempt Employee status is set to Yes.

Changes to the W-2s On Disk(ette) Function
The W-2s On Disk(ette) function in Payroll has been modified to accommodate 2010 W-2 diskette and electronic reporting for federal and for states such as Maine, Ohio, Oregon, Virginia and Indiana. If you need details about the file layout and requirements, refer to the reporting specifications issued by your government agencies and the Update Notice document.

Changes to the Quarterly Wage On Disk(ette) Function
The Payroll Quarterly Wage On Disk(ette) function has been modified to reflect the reporting specification changes made by Colorado and Oklahoma. If you need details about the file layout and requirements, refer to the reporting specifications issued by your government agencies and the Quarterly Wage on Diskette document.

As most of you may be aware by now of the new changes with the Sage Customer Portal, there is a new process to download the payroll tax updates. Equation can help you review this download process and make sure that you are ready for Jan 1, 2011. You can apply the updates on your own or setup an appointment with Equation for a consultant to assist you in applying the tax update and activate the update accordingly in each payroll database for you. Please call our office Support line at 866.436.3530 dial 1 from the main menu to schedule an appointment.

Click here to review and learn more about the Tax Update Notifications.

Topics: Sage 300 (ACCPAC), Sage HRMS and Payroll Processing

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