NEW FORM: LS 52 – For any employees hired after October 2009, you must have a completed Form LS 52 in your employees file, Notice and Acknowledgement of Wage Rate and Designated Payday Hourly plus Overtime. A copy of the completed form must be provided to the employee. This form, along with a completed copy of Form W-4 and I-9 should be retained in the employee’s file. A copy of Form LS 52 can be obtained at www.labor.state.ny.us.

SOCIAL SECURITY AND MEDICARE FOR 2010 – The total withholding remains at 7.65% and the wage base for 2010 remains at $106,800 for OASDI portion (at 6.2%).

MINIMUJM WAGE FOR 2010 – the minimum wage continues at the federal amount of $7.25 per hour.

CORRECTING PREVIOUSLY FILED FORM 941's – IRS has created a new Form 941X to report corrected information on previously filed Form 941. Go to www.irs.gov to review new procedures. IRS will continue to allow penalty and interest free corrections of previously filed Form 941 if the new procedures are followed.

NEW HIRE REPORTING - You have 20 days to notify NYS of newly hired employees. You can do this online at www.nynewhire.com if you register to do so. Otherwise, you can fax in a copy of Form W-4 (that has the employer information completed on it) to NYS using the fax number as indicated on Page 4.

FORM 1099 BACKUP WITHHOLDING– Again, we stress that if you do not have a social security number or a federal identification number for a potential 1099, pay the recipient only 78% of any payments that may be due them and send a letter requesting that they provide you with the proper identification number by completing the enclosed Form W-9. Go to www.irs.gov to get the complete details regarding backup withholding.

FEDERAL AND STATE WAGE BASE FOR UNEMPLOYMENT INSURANCE – The federal wage base for unemployment insurance continues at $7,000 for 2010 with the effective tax rate of .8%. NYS wage base continues at $8,500.

NEW YORK STATE FORMS – As you are probably aware, NYS continues to try to be paperless. Most forms required for both payroll and sales tax reporting are no longer being mailed directly to you. These forms can be electronically filed using the NYS OnLine Center. NYS is encouraging that all employers utilize the OnLine Center for filing purposes.

Payment of Withholding Taxes

Federal Payment Requirements:

IRS has notified you during the fourth quarter of 2009 of your depository status for 2010. This status is determined by your history of total withholding liability for the period 07/01/08 through 06/30/09. If that total is more than $50,000, you are required to make semi-weekly deposits. If your accumulated liability is over $2,500, you must make monthly deposits. The computation of liability remains the same:

Liability = (OASDI W/H X 2) + (Medicare W/H X 2) + Federal W/H

Payment of payroll tax liability is determined by the following:

New York State Payment Requirements:

Liability is computed based on actual total withholding of New York State tax and is summarized as follows:

If at the end of a quarter, the withholding liability is under $700 and a payment has been made during the quarter, a payment of the balance should be made prior to the last day of the month following the end of the quarter --OR-- it may be paid with the quarterly report.

Quarterly Reporting Requirements
(Due the last day of January, April, July and October)

FEDERAL WITHHOLDING TAXES - FORM 941

Form 941, "Employer's Quarterly Federal Tax Return", must be filed showing the breakdown of tax liabilities for the quarter. If the total undeposited tax exceeds $2,500, a deposit must be made with an authorized depository by the 15th. If the total undeposited tax is less than $2,500, it may be paid with the form or deposited with an authorized depository.

FEDERAL UNEMPLOYMENT INSURANCE TAX – FORM 940

Deposit Federal Unemployment Insurance (FUTA Tax) computed on a quarterly basis at the net rate of 0.8% of the first $7,000 in gross wages paid per employee per calendar year in New York State. No deposit is required for any quarter in which the liability plus the accumulated liability for the previous quarters is less than $500 (except for fourth quarter). If you are enrolled in the electronic filing system, you must make your deposit using EFTPS.

NYS COMBINED WITHHOLDING & UNEMPLOYMENT - FORM NYS-45 AND NYS-45-ATT

New York State continues to use Form NYS-45, "Quarterly Combined Withholding Wage Reporting and Unemployment Insurance Report" to report quarterly liability for unemployment insurance along with reconciling NYS withholding for the quarter.

Annual Reporting Requirements

FORM 944 – This is the annual form that enables small businesses that have less than $1,000 in payroll taxes due for the entire year file only once. Payment of tax is made with the form on an annual basis due January 31st of the year after the payroll liability is incurred. Note: IRS will advise if you are a 944 filer, but if your liability increases, you must still make monthly payments using the $2,500 rule.

FORM 940 – This is the ANNUAL Federal Unemployment Insurance Tax form for employers, which reconciles all payments made for the year to quarterly liabilities. The balance, if under $500, may be paid with the form.

FORM W-2 – Wage statements must be completed and distributed to employees on or before February 2, 2010. Form W-2 for 2009 has remained exactly the same as 2008. Please review the instructions before completion. USE forms W-2C and W-3C to correct previously filed W-2’s and W-3.

FORM W-3 – This is a transmittal and reconciliation schedule to accompany the Forms W-2. Form W-3, together with W-2's are to be mailed by March 1, 2010 to Social Security Administration, Data Operations Center, Wilkes-Barre, PA 18769-0001.

FORM NYS-45-ATT – For fourth quarter only, this form may be filed separately on or before March 1, 2010 showing only annual gross wages and withholdings. This form is the “NYS W-2.”

FORM 1099 – "Federal Information Return for the Calendar Year 2009". On or before March 1, 2010, Form 1099 must be filed with IRS for each individual or partnership to whom you made payment in 2009, to the extent not reported on Form W-2. You must provide the recipient with a copy of Form 1099 on or before February 1, 2010. You must file a 1099-Misc when you pay $600 or more for services and you must report all payments to attorneys over $600 regardless of type of entity on the 1099-Misc Form.

FORM 1096 – A separate transmittal Form 1096 must be filed with each type of Form 1099. By March 1, 2010, mail Form 1096 with original copies of Form 1099 to Internal Revenue Service Center, Austin, TX 73301.

We recommend that all forms be mailed Certified Mail Return Receipt.

This payroll and 1099 requirement letter has been prepared as a guide and does not attempt to take the place of any of the publications provided to you by the various taxing authorities.

If you do not receive the forms from the taxing agencies, you should contact those agencies and request the missing forms be mailed to you as soon as possible. Telephone numbers of the various agencies are:

Internal Revenue Service - Information 1-800-TAX-1040 (829-1040)

Internal Revenue Service - Small Business 1-800-829-4933

Internal Revenue Service - Forms and Publications 1-800-TAX-FORM (829-3676)

IRS - Information on Electronic Filing 1-800-555-4477

 

Federal Fair Labor Standards 1-315-448-0630

Social Security Administration 1-800-772-1213

NYS Dept of Tax & Fin – Taxpayer Assistance Call Center 1-800-972-1233

NYS Dept of Tax & Fin – Sales Tax Assistance 1-800-698-2909

NYS Dept of Tax & Fin – T/P Assist Call Ctr - Forms Only 1-800-462-8100

NYS Fair Labor Standards – Binghamton 1-607-721-8009

NYS Fair Labor Standards – Syracuse 1-315-735-6198

NYS Labor Dept.- Unemployment Insurance-Information 1-888-899-8810

NYS Tax Fax Hotline - Forms Only Faxed Directly 1-800-748-3676

NYS Dept of State 1-212-417-5800

NYS Dept of State - Division of Corporations 1-518-473-2492

NYS Disability Benefits Bureau 1-800-353-3092

NYS Workmen’s Compensation Board 1-866-750-5157

 

NYS New Hire Notification - FAX # - 1-518-869-3318

 

Most forms and publications can be downloaded off the internet by going to the websites as shown below.

Internal Revenue Service www.irs.gov

IRS: Forms and Publications www.irs.gov/formspubs/index.html

IRS: Business Tax Information www.irs.gov/businesses/index.html

IRS: Efile www.irs.gov/efile/index.html

 

Federal Dept of Labor www.dol.gov

Social Security Administration www.ssa.gov

US Citizenship and Immigration Services www.uscis.gov

 

New York State www.tax.state.ny.us

NYS: Forms www.tax.state.ny.us/forms/

NYS Dept of State www.dos.state.ny.us

NYS Dept of Labor www.labor.state.ny.us

 

NYS New Hire Online www.nynewhire.com/

 

NOTE: If any questions arise, do not hesitate to call our offices for assistance (607) 432-8700 or (315) 797-7781.