Illinois Payroll

Sunday, January 16th, 2011

Illinois Payroll: Illinois Tax Hike | Illinois Tax Increase

 

Our Payroll Mate payroll tax software has been updated to include the latest Illinois withholding tables, which reflect the recent Illinois tax increase. Effective January 1, 2011, the rate for withholding Illinois Income Tax is 5 percent. The Illinois payroll tax hike was passed by Illinois lawmakers on Wednesday January, 12, 2011.

 Illinois 2011 Payroll, Illinois 2011 Tax Hike, 2011 Illinois Tax Increas

According to a new Illinois Department of Revenue bulletin released last Thursday, Illinois employers and payroll departments must now immediately adjust withholding tax rates to reflect the Illinois Income Tax rate increase from 3% to 5%, effective January 1, 2011.

The new Illinois rate of withholding applies to Employee compensation (i.e., wages and salaries) paid in Illinois, Unemployment paid to an Illinois resident who has asked to have Illinois taxes withheld, and Gambling or lottery winnings in Illinois paid to an Illinois resident.

Booklet IL-700-T, Illinois Withholding Tax Tables, has been updated to reflect the tax increase.

Example:

You pay Jane $800 every week. She claims 4 allowances on her Form IL-W-4. Two allowances are claimed on Form IL-W-4, Line 1, and two allowances are claimed on Form IL-W-4, Line 2. You withhold $34.23 from her pay.
Step 1: Determine the wages paid: $ 800.00
Step 2: Figure your employee’s exemptions (based on Form IL-W-4): $115.38
Step 3: Subtract the amount exempt from withholding. Taxable amount: $684.62
Step 4: Multiply by the tax rate x 0.05. Tax withheld = $ 34.23

If you use QuickBooks or Quicken to manage your business and you’ve been searching for payroll software that integrates with QuickBooks, then Payroll Mate is definitely for you. With the advanced features in this payroll solution, SMBs can save a bundle by using Payroll Mate to prepare payroll and track payroll taxes and then post payroll data to QuickBooks at the end of the pay period. Payroll Mate is currently used by small businesses, accountants, businesses, CPAs, churches, banks, professional tax preparers and payroll service providers.

To learn more about our payroll software, please visit http://www.payrollmate.com/