Over the next few weeks, as your employees start to receive their 2019 W-2 form, they will most likely have many questions as to what all those numbers mean. For example, it is not uncommon for a salaried employee who earns $50,000 per year question why their Box 1 Wages only reflects $45,000. The response may be, ‘do you contribute to a pension plan or have pre-tax insurance, then if so those amounts reduce your “taxable” wage, which is what appears in Box 1’. To assist you with questions like that, here is a handy guide. Download the 2019 W-2…
Posts published in “Forms”
The W-4 form has remained basically unchanged for many decades. For a flashback, here is what it looked like in 1990: https://www.irs.gov/pub/irs-prior/fw4–1990.pdf. Unchanged until now, that is. The IRS has done a complete revamp of the form for 2020 by adding many additional fields for the employee to complete as well as removing ‘number of allowances.’ You may ask how that can be since the number of allowances basically dictated the amount of federal income tax withheld from a paycheck. You need to see the new form to believe it, and here it is: https://www.irs.gov/pub/irs-dft/fw4–dft.pdf. The form asks the employee…
Whew! We dodged a bullet… at least for another year. If you are not familiar with what the 2019 W-4 form could have looked like, then keep an eye out for a future article where we will give it a thorough review as it is now postponed for 2020 by the U.S. Treasury. The new 2019 W-4 form has been published (including the Spanish W-4(SP) version) and not much is changed from the 2018 version. A Form W-4 remains in effect until the employee gives you a new one, so you do not need to obtain a new form each year. When…
A question I am often asked is ‘How long must I maintain my payroll records?’, and the answer is; “it depends”. Reason being is that there are many different documents that are maintained within the payroll world by a myriad of federal, state, and local agencies, and a lots of overlap. Some people put a blanket retention policy of seven years across all documents, but in some cases as we will see, even that may not be long enough. Namely if the records are for an active employee. Let’s take a look at the more popular forms and documents, and bring some order to…
E-Verify started as a pilot program in 1997 to help employers verify the work authorization of new hires. When you have an employee complete a USCIS Form I-9, you are taking the word of the employee and the face value of the documents they provide. E-Verify allows you to confirm the provided documentation against multiple government databases. All employers must first complete an I-9 form for every new hire, within three business days of the date the employee starts work. Employers must not begin the I-9 process until after the individual is hired. The newly-hired employee jointly completes the I-9 form…
If you are like me, you have been at the edge of your seat waiting for the IRS to release the 2018 Form W-4, Employee Withholding Allowance Certificate since January 1st. Well, on February 28th the wait ended, and here is the new form in all four pages of glory. Yes, four pages. Double the prior year’s 1 page front and back form. At the end of the day, the certificate itself is still just a 1/3 of the first page where the employee will basically indicate whether they are withholding at Single, Married, or Married, but withhold at the higher…
Over the next few weeks as your employees start to receive their 2017 W-2 form, they will most likely have questions as to what all those numbers mean. For example, it is not uncommon for a salaried employee who earns $50,000 per year question why their Box 1 Wages only reflects $45,000. The response is, ‘do you contribute to a pension plan or have pre-tax insurance, then if so those amounts reduce your “taxable” wage, which is what appears in Box 1’. To assist you with those questions, here is an explanation of what is in each box and what…
With the recent passing of the new tax law, we will find a significant delay in the IRS’ publishing of the 2018 W-4 Withholding Allowance Form. In the meantime, anyone hired in 2018 should complete the 2017 form, and they will not need to complete the 2018 form when it is released. Unless that is, if they want to later change their withholding. A Form W-4 remains in effect until the employee gives you a new one. When you receive a new form, begin withholding no later than the start of the first payroll period ending on or after the 30th…
United States Citizenship and Immigration Services (USCIS) Form I-9 is used for verifying the identity and employment authorization of all individuals (citizens and non-citizens) hired for employment. On July 17th USCIS released a new form and employers have 60 days to implement this new version. First introduced in November 1986, this form is completed by both the newly hired Employee (where they state their eligibility to work -Section 1), and the Employer (where they verify the employee’s eligibility -Section 2) within three days of hire. The list of acceptable documents referenced by the employer to verify the employee’s eligibility…