Payroll

Wednesday, January 6th, 2010

2010 Payroll Withholding | 2010 Withholding Calculator

Our Payroll Mate payroll software comes with a complete 2010 withholding calculator that is capable of calculating 2010 payroll withholding for federal withholding tax and different state withholding taxes. Payroll Mate has been updated to include the latest 2010 withholding tables released by the Internal Revenue Service and the different state departments of revenue .

If you would like to download a free demo of 2010 Payroll Mate payroll software (which includes a built-in 2010 withholding calculator) please go to our payroll software download page or visit www.realtaxtools.com .

2010 Payroll Withholding Details:

Alabama (AL) 2010 Payroll Withholding: There are two methods for computing Alabama withholding tax. Tax can be computed using the tables provided in the “Alabama Instructions for Employers and Withholding Agents” booklet or tax can be computed using the withholding tax formula which is also provided in the same booklet. Payroll Mate uses the withholding tax formula.

Alaska (AK) 2010 Payroll Withholding: The state of Alaska does not withhold state income tax.

Arizona (AZ) 2010 Payroll Withholding: Arizona income tax withholding is a percentage of the amount of federal income tax withheld. The employee completes Arizona Form A-4, Employee’s Arizona Withholding Percentage Election, to elect an Arizona withholding percentage. Amounts that are considered to be wages for federal tax purposes are also considered wages for Arizona income tax and withholding purposes.

Arkansas (AR) 2010 Payroll Withholding: There are two methods for computing Arkansas payroll withholding. Withholding can be computed using the tables provided in the “STATE OF ARKANSAS INCOME TAX WITHHOLDING TABLES AND INSTRUCTIONS FOR EMPLOYERS” book or tax can be computed using the withholding tax formula which is also provided in the same booklet. The tables include tax amounts for daily, weekly, biweekly, semi-monthly and monthly. Employers who are using a computer can use the tax formula or when the dependents claimed exceeds the number of dependents provided by the tables. Payroll Mate payroll software uses the computer tax formula.

California (CA) 2010 Payroll Withholding: California provides two methods for determining the amount of wages and salaries to be withheld for state personal income tax. METHOD A provides a quick & easy way to select the appropriate withholding amount, based on the payroll period, filing status, and number of withholding allowances (regular and additional) if claimed. The STANDARD DEDUCTION and EXEMPTION ALLOWANCE CREDIT are already included in the wage bracket tables. METHOD B may be used to calculate withholding amounts either manually or by computer. This method will give an exact amount of tax to withhold. Payroll Mate payroll software and 2010 withholding calculator use METHOD B to calculate California 2010 Payroll Withholding.

Colorado (CO) 2010 Payroll Withholding: There are two different methods for determining how much income you should withhold from an employee’s paycheck; Wage Bracket Method and Percentage Method of Withholding. Payroll Mate uses the Colorado Percentage Method of Withholding.

Connecticut (CT) 2010 Payroll Withholding: Employers can use either the withholding calculation rules or the withholding tables to determine the amount of tax to be withheld from the wages of employees. There is no percentage method available to determine Connecticut withholding. Payroll Mate payroll software uses

Delaware (DE) 2010 Payroll Withholding: An employer may withhold taxes according to the withholding tax tables provided in the employer guide booklet or use any approved formula to determine the correct amount of tax to be withheld each pay period. The employer must withhold at a rate so that no tax is estimated to be due on the wages paid when the employee files his or her personal income tax return. The Division of Revenue will approve an alternate formula that considers the allowable standard deduction and tax credit(s) claimed by the employee, using the tax rate schedule on the balance of the wages paid. Payroll Mate uses the “Withholding Methods Based on Annualized Wages”, which is one of the methods approved by Delaware.

District of Columbia (DC) 2010 Payroll Withholding: DC income tax is to be withheld in accordance with either the wage bracket method or the percentage of wages paid method. Tax is withheld from each wage payment in accordance with the information provided on the employee’s withholding allowance certificate (DC Form D-4). Payroll Mate’s 2010 Withholding Calculator uses the  “Percentage of Wages Paid Method”, which is approved by the D.C Office of Tax and Revenue.

Florida (FL) 2010 Payroll Withholding: The state of Florida does not withhold state income tax.

Georgia (GA) 2010 Payroll Withholding: The amount of tax to withhold is based on wages, number of allowances, and additional withholding amounts as indicated on Form G-4 Employee’s Withholding Allowance Certificate or Form G-4P Withholding Certificate for Pension and Annuity Payments. Employers can use the tax tables or the percentage method to determine the amount of tax to withhold. The tax tables calculate withholding tax based on an income range. Applicable standard deductions and personal allowances are factored into the tables. The percentage method calculates withholding tax based on a specific dollar amount. Taxable income is derived by reducing gross wages by the appropriate deductions. For this reason, tax amounts derived from one method will slightly differ from those derived from the other. Payroll Mate’s 2010 Withholding Calculator uses the the percentage method.

Hawaii (HI) 2010 Payroll Withholding: Hawaii provides two methods of withholding; withholding tax tables and the the formula method. Payroll Mate uses the formula method to calculate Hawaii 2010 Payroll Withholding.

Idaho (ID) 2010 Payroll Withholding: Idaho Payroll Withholding can be calculated using the Percentage Computation and Wage Bracket Methods. Payroll Mate uses the percentage computation method with rounding to the nearest Dollar.

Illinois (IL) 2010 Payroll Withholding: Generally, the rate for withholding Illinois Income Tax is 3 percent. For wages and other compensation, subtract any exemptions from the wages paid and multiply the result by 3 percent.

Indiana (IN) 2010 Payroll Withholding: The rate for withholding Indiana Income Tax is 3.4 percent.

Iowa (IA) 2010 Payroll Withholding: There are two methods of figuring the Iowa income tax withholding. The employer can use either the manual tables or the computer formula. Either method is acceptable. Payroll Mate’s 2010 Withholding Calculator uses the computer formula.

Kansas (KS) 2010 Payroll Withholding: There are two methods you may use to determine the amount of Kansas income tax to be withheld from a wage or other payment subject to Kansas income tax withholding — the percentage formula and the wage bracket tables. Both methods use a series of tables for single and married taxpayers for each type of payroll period frequency (weekly, monthly, etc.). Payroll Mate payroll software uses the percentage formula in its internal 2010 Withholding Calculator.

Kentucky (KY) 2010 Payroll Withholding: The employer must withhold tax according to the tables or computer formula. Payroll Mate uses the computer formula.

Louisiana (LA) 2010 Payroll Withholding: According to Louisiana Administrative Code 61:I.1501, employers are required to deduct and withhold taxes in an amount determined in accordance with the tables or formula provided through the rulemaking process. The Withholding Tax Tables method determines the amount of tax to be deducted and withheld based upon the employee’s payroll period, number of withholding exemptions and dependency credits, and wage brackets. The computer formula method produces equivalent amounts and is the method currently used by Payroll Mate withholding calculator.

Maine (ME) 2010 Payroll Withholding: Any of the following methods may be used to calculate the amount of Maine income tax to withhold from payments subject to the federal wage method of withholding: Percentage Method , Wage Bracket Tables , Flat-Amount (Fixed Percentage Rate Method) or Alternate Method. Payroll Mate payroll software uses the percentage method (rounded to nearest dollar).

Maryland (MD) 2010 Payroll Withholding: Employers and withholding agents may use the withholding tables to determine the correct amount of state and local income tax that must be withheld from employee wages. To determine a precise amount to be withheld, use the percentage method tables. Payroll Mate payroll software uses the percentage method tables.

Massachusetts (MA) 2010 Payroll Withholding: The amount of income tax withheld is based on the employee’s taxable wages, the number of exemptions claimed, and any additional withholding amounts requested on the Massachusetts Employee’s Withholding Exemption Certificate (Form M-4). Withholding is calculated either by using the tax tables available from DOR or by using a mathematical formula commonly known as the percentage method. Payroll Mate 2010 Withholding Calculator uses the mathematical formula.

Michigan (MI) 2010 Payroll Withholding: Determine the amount of tax withheld using a direct percentage computation or the withholding tables. The withholding rate is 4.35 percent of compensation after deducting the personal and dependency exemption allowance. Payroll Mate payroll software uses the direct percentage computation.

Minnesota (MN) 2010 Payroll Withholding: Employers and withholding agents can either use the Minnesota Withholding Computer Formula or the Minnesota withholding tables. Payroll Mate uses the Computer Formula.

Mississippi (MS) 2010 Payroll Withholding: The tax table method or the computer accounting formula can be used to calculate the Mississippi Payroll Withholding. The 2010 Withholding Calculator inside payroll mate uses the computer accounting formula.

Missouri (MO)  2010 Payroll Withholding: Use the taxable wages to determine the amount of withholding. In determining the amount of tax to be withheld, use the table for the correct payroll period — daily, weekly, biweekly, semimonthly and monthly periods. The Percentage Formula Withholding  may be used on electronic data processing equipment for withholding Missouri income tax. Our 2010 Withholding Calculator uses the Percentage Formula to calculate 2010 Payroll Withholding.

Montana (MT) 2010 Payroll Withholding: You can either use Montana Withholding Tax Formula for Computerized Payroll Systems or the withholding tax tables. The 2010 Withholding Calculator built into Payroll Mate uses the Montana Withholding Tax Formula.

Nebraska (NE) 2010 Payroll Withholding: Employers can either use the Percentage Method or the withholding tables. Payroll Mate uses the Percentage Method.

Nevada (NV) 2010 Payroll Withholding: The state of Nevada does not withhold state income tax.

New Hampshire (NH) 2010 Payroll Withholding: The state of New Hampshire does not withhold state income tax.

New Jersey (NJ) 2010 Payroll Withholding: Employers can use the PERCENTAGE METHOD OF WITHHOLDING Applicable to Wages, Salaries, and Commissions Paid on and after January 1, 2010. Employers can also use the withholding tables. Our New Jersey 2010 Withholding Calculator uses the percentage method of withholding.

New Mexico (NM) 2010 Payroll Withholding: Employers can use the percentage method of withholding tax, and detailed “look-up” tables. Payroll Mate uses the percentage method.

New York (NY) 2010 Payroll Withholding: Employer can use the dollar-to-dollar withholding tables or the exact calculation method. Payroll

Mate New York 2010 Withholding Calculator uses the exact calculation method.

North Carolina (NC) 2010 Payroll Withholding: There are three primary methods for computing the amount to withhold from wages. The wage bracket tables are the first method. The formula tables for the Percentage Method and the Annualized Wages Method also acceptable. These methods are suitable for computer processing. In addition, an employer may use any other method or formula to determine the amount of tax required to be withheld if the amount determined is substantially the same as that obtained by using the wage bracket tables. The 2010 Withholding Calculator inside Payroll Mate uses the Annualized Wages Method.

North Dakota (ND) 2010 Payroll Withholding:  There are three different methods accepted by North Dakota. Of the three methods employers might consider using the first method, Percentage of Wages. This method most closely resembles the Internal Revenue Service Percentage Method. The second method, Percent of Federal Withholding, is calculated as a percent of federal withholding. North Dakota does not recommend that you use this method for certain employees because it is possible to create a situation of over-withholding. Lastly, the third method utilizes Withholding Tables. These tables are more useful for those employers who only have a few employees and use a manual payroll operation. Payroll Mate 2010 Withholding Calculator uses the Percentage of Wages method.

Ohio (OH) 2010 Payroll Withholding: Payroll Mate uses the Computer Formula to calculate the Ohio 2010 Payroll Withholding.
Oklahoma (OK) 2010 Payroll Withholding: There are two methods you may use to determine the amount of Oklahoma income tax to be withheld from wage payments subject to Oklahoma income tax withholding – the percentage formula method and the wage bracket tables. Both methods use a series of tables for single and married taxpayers for each type of payroll period frequency (weekly, monthly, etc.). Payroll Mate uses the the percentage formula method.

Oregon (OR)  2010 Payroll Withholding: Employers can use the standard tax tables or the computer formula for automated payroll data systems. Payroll Mate withholding calculator uses the computer formula in it’s built-in 2010 Withholding Calculator.

Pennsylvania (PA) 2010 Payroll Withholding:  Payroll Mate payroll software uses the percentage of total wages method.

Rhode Island (RI) 2010 Payroll Withholding:  Employers can use either the percentage method or the with withholding tables. Payroll Mate uses the percentage method.

South Carolina (SC) 2010 Payroll Withholding:  Employers can use either the formula or the wage bracket tables.

South Dakota (SD) 2010 Payroll Withholding:  The state of South Dakota does not withhold state income tax.
 
Tennessee (TN) 2010 Payroll Withholding :  The state of Tennessee does not withhold state income tax.

Texas (TX) 2010 Payroll Withholding: The state of  Texas does not withhold state income tax.

Utah (UT) 2010 Payroll Withholding: Employers can use the withholding tables or the percentage method. Payroll Mate uses the percentage method.

Vermont (VT) 2010 Payroll Withholding: Employers can use the withholding tables or the percentage method. Payroll Mate’s  2010 Withholding Calculator uses the percentage method.

Virginia (VA)  2010 Payroll Withholding: Employers can use the computer formula or the withholding tables. Our 2010 Withholding Calculator uses the computer formula.

Washington (WA) 2010 Payroll Withholding:  The state of Washington does not withhold state income tax.

West Virginia (WV)  2010 Payroll Withholding:  The amount of tax to be withheld is based on the employee’s withholding exemption certificate and the rates defined by the WEST VIRGINIA EMPLOYER’S WITHHOLDING TAX TABLES booklet. To determine the amount of tax to be withheld, the employer may use the wage bracket tables or the percentage method. Payroll Mate uses the percentage method to calculate the 2010 payroll withholding.

Wisconsin (WI)   2010 Payroll Withholding: Payroll Mate uses METHOD “B”, which is one of two alternate methods approved by the state in addition to the wage bracket tables.

Businesses can save a lot of time and money by using our Payroll Mate payroll software to calculate 2010 payroll withholding and to prepare payroll checks and payroll forms. You can download a free payroll software demo by going to payroll software download page. Please also visit our main page http://www.realtaxtools.com/ to learn learn more about our different payroll and w2 1099 software products.

Tuesday, January 5th, 2010

Payroll Software Direct Deposit: Creating ACH Files Using Payroll Mate Software

Looking for an easy way to reduce costs, streamline the processes to pay your employees, and enhance employee job satisfaction ? Payroll Mate Direct Deposit option is an easy and affordable solution for you to pay your employees and save precious time and money.

What is direct deposit?
Direct Deposit, also known as Electronic Funds Transfer (EFT), is the transfer of funds from the employer’s bank account to the employee’s checking or savings accounts at a participating bank.

What is an ACH file?
ACH (Automated Clearing House) is a special type of computer files that includes instructions for the exchange and settlement of electronic payments passed between financial institutions. In the case of Payroll Direct Deposit, the file includes instructions for the transfer of money from the employer’s bank account to the employees’ bank accounts. ACH is also referred to as NACH or NACHA.

What is a routing number?
A routing transit number is a nine digit bank code, which appears on the bottom of checks identifying the financial institution on which it was drawn. This code is also used by financial institutions to process direct deposits and other automated transfers.

In a nutshell, how does the direct deposit feature work inside Payroll Mate?
Payroll Mate payroll software creates an ACH file (special type of computer file), which the employer sends to the bank. The bank would then use the information inside the ACH file to transfer funds from the company’s bank account to the employees’ bank account.

I own a copy of Payroll Mate software. How do I use Payroll Direct Deposit?

(1) Talk to your bank and make sure they accept payroll direct deposit through ACH files.

(2) Purchase and enable Payroll Mate Option #2 (Direct Deposit).

(3) Inside Payroll Mate: for each employee that you wish to include in the Direct Deposit process, you have to fill the fields in the “Direct Deposit” page of the “New Employee”/”Modify Employee” wizards. This page includes basic information such as Account Type ( “Checking” or “Saving”) , Bank Routing Number and employees Account Number.

(4) Create payroll checks for the employees you want to pay (just like you would usually do using Payroll Mate).

(5) Select the direct deposit tool inside Payroll Mate (from the top menu click on Tools and then click on “Generate Direct Deposit file”). Fill in all the information in the dialog that comes up. Please note that you must contact the bank that is going to process the Direct Deposit file before you go ahead and fill the fields in “Company Banking Information” group. The bank should give you enough information to fill in these fields. The “Company Banking Information” includes the folowing:

Originating Bank Routing Number : This could be the transit routing number of your company’s bank. Payroll Mate accepts only valid routing numbers.

Origin Name : This field could be filled with the company’s name.

Immediate Origin : This field’s value is used to identify your company. Your bank might for example choose to use your IRS Federal Identification Number or even create a unique number for you.

Company Identification : Payroll Mate uses this field’s value to fill in “Company Identification” field in the Direct Deposit file which appears on Field 5 in the “Batch Header Record” and Field 7 in the “Batch Control Record”. Whether this field’s value is the same as that of “Immediate Origin”, or it is set to any different value, is a matter decided by the bank processing the Direct Deposit file.

Company Entry Description : This field’s value is used to describe the purpose of the bank transaction; this description might be printed on the employee’s bank statement. Payroll Mate fills this field with the default value of “PAYROLL” and gives you the option to change it as necessary after consulting your bank.

Destination Bank Routing Number :This value should be provided by your bank. Payroll Mate accepts only valid routing numbers.

Destination Name : This could be the name of your bank.

(6) Click “OK” inside the “Direct Deposit” dialog. If you entered all the required fields properly then Payroll Mate will create the output ACH file.

(7) Send the ACH file generated from Payroll Mate to the bank and ask them to process your payroll direct deposit.

Friday, December 11th, 2009

Payroll Software : North Dakota Releases 2010 Withholding Tables

The state of North Dakota has issued the 2010 payroll withholding tables. The new tables will be implemented as part of our 2010 payroll software. If you are not already using our Payroll Mate payroll software, you can download a free demo by going to our download page.

North Dakota uses three different methods for calculating withholding. The first method is “Percentage of Wages”, which most closely resembles the Internal Revenue Service Percentage Method. The second method, Percent of Federal Withholding, is calculated as a percent of federal withholding. Lastly, the third method utilizes “Withholding Tables”. These tables are more useful for those employers who only have a few employees and use a manual payroll operation.

Our Payroll Mate payroll software uses “Percentage of Wages”, which is the method recommend by the state of North Dakota and typically used by payroll softwares.

For more information, please visit the payroll software page on our website.

Friday, November 6th, 2009

2010 Payroll Software: California Issues Advance 2010 Withholding Tables

The state of California has issued the 2010 payroll withholding tables, effective for wages paid on and after January 1, 2010.  California provides two methods for determining the amount of wages and salaries to be withheld for state personal income tax:

METHOD A provides a quick & easy way to select the appropriate withholding amount, based on the payroll period, filing status, and number of withholding allowances (regular and additional) if claimed. The STANDARD DEDUCTION and EXEMPTION ALLOWANCE CREDIT are already included in the wage bracket tables. Even though this method involves fewer computations than Method B, it cannot be used with your computer in determining amounts to be withheld.

METHOD B may be used to calculate withholding amounts either manually or by computer using a payroll software. This method will give an exact amount of tax to withhold. To use this method, you must enter the payroll period, filing status, number of withholding allowances, standard deduction, and exemption allowance credit amounts.

Our Payroll Mate payroll system uses Method B to calculate California withholding. To learn more about our product and to download a free demo please go to www.realtaxtools.com  .

Friday, November 6th, 2009

2010 Payroll Software – Form 944 eligibility and Form 944 filing requirements.

The IRS has released a new revenue procedure (IRB 2009-45), which sets forth the procedures for employers to follow to request to file Form 944, Employer’s ANNUAL Federal Tax Return (i.e., to opt in). In addition, this revenue procedure sets forth the procedures for employers who previously were notified to file Form 944 to follow to request to file Forms 941, Employer’s QUARTERLY Federal Tax Return, instead (i.e., to opt out).

Requests to File Form 944 (opt in to filing Form 944): Upon request by qualified employers, the IRS will notify employers in writing of their qualification to file Form 944. Employers may request to file Form 944 by contacting the IRS at the appropriate telephone number or mailing address, by the applicable due date. Employers must not file Form 944 unless they receive notification that they are eligible to do so (form 944 eligibility). Employers who previously received notification of their qualification to file Form 944 must continue to file Form 944 unless the IRS notifies the employer that the employer no longer qualifies to file Form 944 or the employer opts out.

Requests to File Forms 941 (opt out of filing Form 944): Employers who previously were notified to file Form 944 but want to file Forms 941 instead must call or write the IRS stating that they want to opt out of filing Form 944 before the applicable due date. The IRS will send written notification to employers that their filing requirement was changed to Forms 941. Employers who were notified of their qualification to file Form 944 but do not receive notification that their filing requirement was changed to Forms 941 must file Form 944 rather than Forms 941.

For more information about the due date to opt-in/ opt-out of filing Form 944 please visit the IRS website.

Our form 941 software prepares IRS forms 941, 940, 944, W2 and W3. To download a free payroll software demo, please go to www.realtaxtools.com .