Baltimore City Payroll : Baltimore City Tax Rate | Baltimore City Tax Increase


Businesses in Baltimore City can use our payroll tax software to automatically calculate Baltimore City Tax and Maryland state withholding. The software gives users everything they need to prepare Baltimore payroll and print payroll checks. A free demo of the software can be downloaded by visiting the Maryland payroll software page.

Effective January 1st, 2011 the Baltimore city income tax rate will increase to be 3.2%, the old rate was 3.05%. This rate change will be automatically reflected in the payroll withholding tables that ship with our payroll software.

Below is a list of the Maryland local income tax rates for tax year 2010:

Allegany .0305
Anne Arundel .0256
Baltimore City .0305
Baltimore County .0283
Calvert .0280
Caroline .0263
Carroll .0305
Cecil .0280
Charles .0290
Dorchester .0262
Frederick .0296
Garrett .0265
Harford .0306
Howard .0320
Kent .0285
Montgomery .0320
Prince George’s .0320
Queen Anne’s .0285
St. Mary’s .0300
Somerset .0315
Talbot .0225
Washington .0280
Wicomico .0310
Worcester .0125
Nonresidents .0125


To learn more about our small business payroll software, please visit .

1099 Reporting Health Care | 1099 Reporting Health Care Bill


1099 Reporting changes made by the Health Care Bill

Our 1099 reporting software gives accountants and businesses all the tools they need for printing and e-filing 1099’s and W2’s. You can read more about this software from the 1099 software page.

The IRS is seeking comments regarding expanded 1099 reporting requirements with respect to the reporting of payments made in the course of the payor’s trade or business. The new reporting requirements are in section 6041 of the Internal Revenue Code (the Code), which was amended by section 9006 of the Patient Protection and Affordable Care Act of 2010. Very generally, these amendments expand existing information reporting requirements to apply to payments made to corporations and to include certain payments of gross proceeds and with respect to property. The new reporting requirements under these amendments apply to payments made after December 31, 2011.

Section 6041 generally requires information returns to be made by every person (payor) engaged in a trade or business who makes payments, as defined in section 6041(a), aggregating $600 or more in any taxable year to another person (payee) in the course of the payor’s trade or business. The information returns must be filed with the Internal Revenue Service and corresponding statements must be sent to each payee. Form 1099-MISC, Miscellaneous Income, is generally used for this purpose, although Form W-2, Wage and Tax Statement, is generally used for payments to employees.

The Act amended section 6041(a) to add payments of “amounts in consideration for property” and “gross proceeds” to the list of payments subject to reporting. However, the Act retained existing exceptions in section 6041(a) for “payments to which section 6042(a)(1), 6044(a)(1), 6047(e), 6049(a), or 6050N(a) applies,” and “payments with respect to which a statement is required under the authority of section 6042(a)(2), 6044(a)(2), or 6045.” These excepted payments include most interest, dividends, royalties, and securities and broker transactions.

The Act also added new section 6041(h) regarding the application of section 6041 to payments made to corporations. Existing regulations under section 6041 generally except payments to corporations, exempt organizations, governmental entities, international organizations, and retirement plans from reporting under section 6041. See Treas. Reg. §1.6041-3(p). New section 6041(h) provides that, notwithstanding any regulation prescribed by the Secretary before the date of enactment, for purposes of section 6041, the term “person” includes any corporation that is not an organization exempt from tax under section 501(a). Thus, under new section 6041(h), payments to corporations that are not tax-exempt may be subject to information reporting.

Finally, the Act added new section 6041(i) authorizing the Secretary to prescribe such regulations and other guidance as may be appropriate or necessary to carry out the purposes of section 6041, including rules to prevent duplicative reporting of transactions. Also, section 6041(a) provides generally that information returns under section 6041 shall be furnished under such regulations and in such form and manner, and to such extent, as may be prescribed by the Secretary.

The Treasury Department and the Internal Revenue Service intend to issue guidance that will implement these changes to section 6041 in a manner that minimizes burden and avoids duplicative reporting. This notice requests comments regarding possible approaches to the section 6041 guidance that will assist in achieving those goals.

For example, the Treasury Department and the Internal Revenue Service have already issued a proposed regulation that would allow a broad exception from section 6041 information reporting for payment card transactions that would otherwise be reportable under section 6050W of the Code, effective for payments beginning in 2011. This proposed regulation is expected to be finalized later this summer. Thus, business purchases made with payment cards will be exempt from information reporting under section 6041.

The Treasury Department and the Internal Revenue Service request comments on additional circumstances in which duplicative reporting might otherwise occur under section 6041 and another Code section, such as section 3402(t), and on rules that would prevent such duplicative reporting. Specific comments are also requested regarding the burden associated with implementing the new reporting requirements for different types of taxpayers and businesses.

California Payroll: New e-Services will enable employers to handle their payroll taxes online in 2011


California employers, businesses and accountants can use our California payroll software to prepare payroll, calculate California withholding and print California payroll forms DE-6 and DE-7. To learn more about our payroll tax solution, please visit our website at .

The California Employment Development Department (EDD) will significantly expand its e-Services for Business in the spring of 2011. Employers will be able to keep track of their accounts and do much of their business with EDD’s Tax Branch over the Internet. These new services will enable them to quickly file returns, make payments, view account information, and manage their accounts securely online.

The new system will also eliminate the annual reconciliation process for employers starting with the 2011 tax year. New quarterly tax forms for next year are currently under development to allow for reporting total Unemployment Insurance (UI) taxable wages and State Disability Insurance (SDI) taxable wages. This will result in faster refunds and identification of amounts due each quarter.

This Internet-based system is the most significant change in the payroll tax process in the past 25 years. It will revolutionize the way EDD’s Tax Branch does business and communicates with employers.

The new Expanded e-Services for Business, quarterly forms, and redesigned account statements will support EDD’s goal to “make employment taxes a breeze” for California employers.

Try our payroll software today by downloading a free demo.

Ohio Payroll: Ohio school district income tax rates | ohio city income tax rates


Businesses in Ohio can use our payroll software to prepare payroll, calculate withholding and print signature-ready payroll checks. A free demo of Payroll Mate payroll software can be downloaded  from the payroll software download page.

Below is a list of the new rates for 2010 , 2011 :

City Income Tax Rates 2010 , 2011:

Grandview Heights: new rate is 2.5 %. The old rate was 2.25 %. Effective on July-1-2010.
Lowellville: new rate is 2 %. The old rate was 1.5 %. Effective on Jan-1-2011.
Marysville City: new rate is 1.5%. The old rate was 1 %. Effective on July-1-2010.
Mayfield: new rate is 2 %. The old rate was 1.5 %. Effective on July-1-2010.
Miamisburg: new rate is 2.25% . The old rate was 1.75%. Effective on Jan-1-2011.
Mogadore: new rate is 2.25% . The old rate was 2 %. Effective on July-1-2010.
Oakwood Village: new rate is 2.5 % . The old rate was 2 %. Effective on July-1-2010.
Pataskala: new rate is 1 %. Effective on July-1-2010.
Worthington: new rate is 2.5 %. The old rate was 2 %. Effective on July-1-2010.

School district income tax rates 2010, 2011:
Bethel: new rate is 0.75%. Effective on Jan-1-2011.
Kenton: new rate is 1.5% . The old rate was 1 %. Effective on Jan-1-2011.
Legemont: new rate is 1.25 %. Effective on Jan-1-2011.
Northwest: new rate is 1 %. Effective on Jan-1-2011.

Small Business Payroll: Illinois Small Business Job Creation Tax Credit


The Illinois Small Business Job Creation Tax Credit is a one year credit that will help create up to 20,000 jobs. Our small business payroll software helps businesses calculate payroll withholding in Illinois including different types of exemptions and deductions. A free demo of the software can be downloaded from here.

This new law creates a $2,500 tax credit (that can be carried forward) on payroll withholding tax for employers with 50 or fewer total employees who hire new, full-time Illinois employees during the 12-month period beginning July 1, 2010. 

95% of Illinois businesses have fewer than 50 employees.

Calculation of the net increase in the number of Illinois employees is based on the employer’s number of Illinois employees as of June 30, 2010. 

The credit is available to qualifying employers for each new, full-time Illinois job created and sustained for at least one year. 

It will have a cap of $50 million on the total amount of credits issued.

To qualify, a job must pay at least $25,000 per year. 

Eligible companies will apply for the credit online and ultimately will be issued a tax credit certificate.

• Application for the credit may be made as soon as a new, full-time Illinois employee is hired after July 1 and begins providing services. 

• Carry forward credits will be issued for each new position, up to a maximum cumulative amount of $50 million, on a first-come-first-served basis determined by date of application. 

• The credits will be issued beginning July 1, 2011.

• The determination of whether an employer has 50 or fewer employees on June 30, 2010 will include all employees in every location, which includes both in Illinois and out of state employment totals.

• Employer subsidiaries created for purposes of benefiting from the credit will not qualify for the credit under aggregation rules; related businesses will be treated as one business for purposes of determining whether an employer has 50 or fewer employees.

• Eligibility for the credit does not require that a particular individual employee be retained for one year, only that a new, full-time Illinois job be created and sustained for one year.

• New small businesses hiring their first Illinois employee(s) may qualify for the credit.

• The credit may be claimed for an hourly employee working an average of at least 35 hours per week or for a full-time salaried employee, but not for a partner or an independent contractor.

• Tax credits granted will not change the recognition of withholding tax paid for either employer or employee.