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Don't Get Bitten By COBRA
First in a three part series
read more...
Seminar: Sexual Harassment Training
California Law AB1825 more...
Unexpected Payroll Tax Refunds?
Always ask before you cash more...
What's new with the 2011 W-2s?
IRS issues interim guidance more...
PLUS
Two Teams, One Focus
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Two Teams, One Focus
At the close of Spring Training we celebrated our 70 home runs with a party and honoring our shining stars.
Most Valuable Player went to Susan Di Fraia, of the Pink Panthers for taking the lead early on and hitting 35 home runs!
Cy Young Award went to Casey Stratmeyer, also of the Pink Panthers for pitching endless enthusiasm to her teammates!
A very special Tony Award (named after our President Tony Bowden) was awarded to Diane Pantera to celebrate over 15 years of committment to Payroll Systems and top notch client service.
Although spring training is over, training hasn't ended. We continue making your payroll process and benefits administration as easy as possible!
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Don't Get Bitten by COBRA
Over the next three months Payroll Systems is addressing the most common COBRA misunderstandings and mistakes that we see employers make.
Three things every employer needs to know:
- COBRA compliance is mandatory. If you have 20 or more employees you must comply with the federal COBRA mandate. The Consolidated Omnibus Budget Reconciliation Act (COBRA) enacted in 1985 has regulations that apply to all employees that are eligible for your benefit plans, not just those enrolled. Note that employers with 2-19 emplyees are subject to Cal-COBRA, a state mandate that is similar to federal COBRA, with the group health carriers handling most of the administration.
- Tax penalities for non-compliance. IRS may fine up to $200 for each day a plan fails to comply with COBRA regulations. There are several notices employees must receive within required time frames. General Notice (also called Initial Notice), Election Notice, and Early Termination are a few of the required notices. The Department of Labor has some model notices that can be customized with your information. Department of Labor Website
- Unpaid claims can be the employer's responsibility. Terminated employees may sue to recover health continuation coverage or claims costs when coverage isn’t offered upon termination. If an employee was terminated or had a reduction in hours that ended his/her group health coverage, that employee must be offered continuation coverage. If coverage isn’t offered, the employer could end up paying for unpaid claims or sued to reinstate coverage.
Did you know that Payroll Systems has in house COBRA experts? We provide affordable COBRA services to alleviate the administrative burden on employers and to avoid the costly consequences of non-compliance. Contact our COBRA department for more information.
See also
Department of Labor Employer’s Guide to COBRA.
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Upcoming Seminar: Sexual Harassment Training
California law AB1825 requires employers with 50 or more employees to provide all managers, supervisors, and shift leads two hours of sexual harassment training every two years. Reduce your company’s exposure, educate your management and staff, and improve your company’s work environment.Join us in April for this seminar and training presented by HRideas.
Date: Thursday, April 28, 2011
Location: Payroll Systems
Cost: $50 for HRI clients/$75 for non-clients
RSVP to reserve your seat.
A certificate is issued to each attendee upon completion of the 2 hour course.
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Did you receive an unexpected payroll tax refund?
When IRS or state agencies are reconciling your accounts it does happen from time to time that something is over looked or there is a keying error that results in an unexpected refund.
What should you do if you receive a payroll tax refund you are not expecting?
DO contact your payroll specialist. If you are enrolled in tax service with Payroll Systems, your payroll specialst may be able to verify that you are indeed due a refund! Or if there is no apparent reason, our tax specialists will research, contact the tax agency if needed, and assist in the resolution on your behalf
DO contact the tax agency that issued the check if you do not have tax service with Payroll Systems. Have your tax returns and payments easily available, and verify the validity of the refund with the tax agency.
DON'T cash before you ask!
What happens if you cash a payroll tax refund check that was issued in error?
You will receive a letter from the tax agency indicating you have a balance due, typically with 30 days to pay or penalties and interest will be assessed.
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What's new with 2011 W-2s?
The Affordable Care Act provides that employers are required to report the cost of employer provided health care coverage on the Form W-2. This requirement is optional for 2011 and for smaller employers (less than 250 W-2s) is optional for 2012 as well. The IRS emphasizes that this new reporting to employees is for their information only. The purpose of the reporting is to provide useful and comparable information to employees on the cost of their health care coverage. The employer provided health coverage costs continues to be excludable from an employee's income, and is not taxable. See IRS Notice 2010-69
deferring the reporting requirement for 2011.
Notice 2011-28 contains a Question and Answer guide for employers that are subject to this requirement for 2012.
Reminder: W-2 reporting of employer provided health coverage costs is optional for all employers for 2011 (generally furnished to employees in January of 2012).
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