It’s that time of year again! Yes, the Christmas season is upon us—and that also means that tax time is approaching. At Precision Payroll, we aim to make tax season as painless as possible.
Here are some changes and requirements you’ll want to know about heading into 2015:
- There are new wage limits for Social Security taxes: $118,500 is the threshold for the 6.2% tax (last year the threshold was $117,700).
- Medicare wage limits remain the same—1.45% up to $200,000, with an additional .9% tax for employees who earn over $200,000.
- The contribution limit for 401Ks is increasing to $18,000 for 2015. The catch-up contribution is $6,000 for employees age 50 and older. For SIMPLE IRAs, the contribution limit for 2015 will increase to $12,500, with the catch-up contribution going up to $3,000.
- The FUTA tax may go up from .6% to .8% – depending upon the 2015 budget that passes. Stay tuned…
- The list of states where the FUTA credit reduction is still effective continues to shrink and now includes seven states: California, Connecticut, Indiana, Kentucky, New York, North Carolina and Ohio.
- Illinois Unemployment:
- Unemployment rates for 2015 have been mailed from IDES. Please send these to your payroll specialist so that we can update your rates in our system. If you have given us Power of Attorney (POA), the rates were sent directly to us. If the change is greater than 2%, we will contact you in case you would like to protest the rate increase.
Also, please note these reminders:
- If you are doing bonus payrolls, additional year-end payrolls, or payroll adjustments, please send your processor the information no later than Dec. 12. We recommend that they be scheduled ahead of time and be run separately from normal payrolls.
- Employees must have W2s postmarked by Jan. 31. Precision Payroll will send your W2s to you by Jan. 26, giving you one week to get them to your employees (unless you have requested that we send them directly to your employees).
PPA + Taxes = Stress-free tax season!
Over 90% of our payroll clients also use our tax services. The advantages of this are numerous, but the ones we hear from clients the most are:
- We will make your tax payments and file all returns on time to avoid penalties.
- We’re on top of the latest rules so you don’t have to be.
- We do any additional research needed to keep you compliant.
- We file electronically, which reduces errors.
- If penalties do occur, we will resolve them for you.
If you are considering having us handle your taxes, the beginning of the year is a great time to start. Please contact your payroll specialist to discuss this further.