MSC Payroll » Payroll Related Laws

HIRE Act: Questions and Answers for Employers

Administrator — Fri, 25 Jun 2010 14:30:09 +0000

Under the Hiring Incentives to Restore Employment (HIRE) Act, enacted March 18, 2010, two new tax benefits are available to employers who hire certain previously unemployed workers (“qualified employees”).

The first, referred to as the payroll tax exemption, provides employers with an exemption from the employer’s 6.2 percent share of social security tax on wages paid to qualifying employees, effective for wages paid from March 19, 2010 through December 31, 2010.

In addition, for each qualified employee retained for at least 52 consecutive weeks, businesses will also be eligible for a general business tax credit, referred to as the new hire retention credit, of 6.2 percent of wages paid to the qualified employee over the 52 week period, up to a maximum credit of $1,000.

For more details, visit:
http://www.irs.gov/businesses/small/article/0,,id=220745,00.html

COBRA Continuation Coverage Assistance Under The American Recovery And Reinvestment Act

Administrator — Wed, 20 May 2009 03:44:02 +0000

The American Recovery and Reinvestment Act of 2009 (ARRA) provides for premium reductions and additional election opportunities for health benefits under the Consolidated Omnibus Budget Reconciliation Act of 1985, commonly called COBRA. Eligible individuals pay only 35 percent of their COBRA premiums and the remaining 65 percent is reimbursed to the coverage provider through a tax credit. The premium reduction applies to periods of health coverage beginning on or after February 17, 2009 and lasts for up to nine months for those eligible for COBRA during the period beginning September 1, 2008 and ending December 31, 2009 due to an involuntary termination of employment that occurred during that period. The TAA Health Coverage Improvement Act of 2009, enacted as part of ARRA, also made changes with regard to COBRA continuation coverage.

For more information click here.

Law Increases 401K Annual Limits

Administrator — Wed, 13 May 2009 13:59:55 +0000

On August 7, 2008, the Governor of Puerto Rico signed into law Act 186, which increases the pre-tax contribution limits for Section 1165(e) savings plans. Under prior law, pre-tax contributions were limited to the lesser of 10 percent of compensation or $8,000 per year. The new law removes immediately the 10 percent cap, so that the limit for 2008 plan years is $8,000 regardless of compensation. It also increased the annual limits for plan years beginning in 2009 and thereafter as follows:

Plan Year	Contribution Limit
2009 and 2010	$ 9,000
2011 and 2012	$ 10,000
2013 and beyond	$ 12,000

Beginning with 2007 plan years, employees who have attained or will attain age 50 by the end of the plan year and whose pre-tax contributions have reached the applicable limit for the year may also make a pre-tax catch-up contribution of up to $1,000.

This blog is published by Micro Systems Consultants.
Visit us at www.mscpr.com to lean more about MSC Payroll.

Restrictions On Social Security Number Usage

Administrator — Sat, 02 May 2009 15:15:22 +0000

On September 26, 2006, Law #206 was approved that restricts the usage of the employee Social Security number on identification cards and on any document of general circulation.

Law #206 applies to all private employers and to all public corporations of the Commonwealth of Puerto Rico. The law establishes fines ranging from $500 to $5,000 per violation.

Users of MSC Payroll comply with this law by setting the “Mask Social Security” flag in the “Program Options” section. Once this flag is set Social Security numbers will only show the last four digits on reports, i.e. “XXX-XX-1234″. If this option is not available you are using an old version of the program and must upgrade it to comply with the law.

Call us at (787) 758-6430 if you have problems finding or setting this flag, or need to upgrade. We will be glad to help you.

The following links take you to other Internet articles related to this law:

Ley 207 Seguro Social.

Ley para prohibir a todo patrono de empresa privada y corporaciones publicas utilizar el Número de Seguro Social de los empleados como medio de identificación.

Abogados Laborales: RESTRICCIONES AL USO DEL NUMERO DE SEGURO SOCIAL

This blog is published by Micro Systems Consultants.
Visit us at www.mscpr.com to lean more about MSC Payroll.