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Dear Clients,

 

We advised you a few months ago about a possible payroll tax increase retroactive to January 1, 2015 and, unfortunately, that tax increase has been imposed by the IRS.

 

There are only three states that are affected this year. They are California, Connecticut and Ohio. These state borrowed funds from the federal governments FUTA (Federal Unemployment Tax) tax reserve several years ago and each year they have until November 10th to pay back the loan. If their loans are not paid back by that date the FUTA tax increases retroactive to January 1st. We learned today that those outstanding loans have not been paid back.

 

This year the tax increase is and additional 1.5% for California and Ohio businesses and an additional 2.1% for businesses with employees in Connecticut. This is an employer tax only and is based on each employees wages up to $7000.00 in California, $9000.00 of wages in Ohio, and $15,000.00 of wages in Connecticut.

 

For businesses with employees in California that is an additional $105.00 per employee. For our Ohio clients it's an additional $135.00 and for our Connecticut clients it's an additional $315.00 per employee.

 

This tax will be collected with the payroll runs in mid-to-late December.

 

If you have questions about this please contact me.

 

 

Sincerely,

Deborah Grandinetti

 

 



 
We, at Payroll Providers, will always do our best to keep you informed of changes related to payroll and would like for you to know that we are here to help with all your payroll needs. Please feel free to call us at any time (661-294-2300).
 
Sincerely,
 

Deborah Grandinetti
Payroll Providers