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The Do's and Don'ts of a Holiday Office Party

2011-12-13T15:10:20Z

‘Ti the season for holiday office parties. Here is a quick rundown of the do’s and don’ts of behavior at a holiday office party:

Don’t

Get intoxicated.
Blabber personal confessions.
Explain what you would do if you were “The Boss”.
Complain about office issues.
Critique the holiday party itself.

Listen as much as speak.
Be remembered for positive feedback rather than embarrassing situations.
Build relationships within your organization.
Talk about family, hobbies and movies.
Eat something before consuming alcohol.

These simple guidelines will help you avoid an embarrassing situation, especially for the day after.

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The IRS giveth and then taketh away: FUTA Tax Rate Increases

2011-12-07T20:51:54Z

Employers in 20 states owe higher tax rates in 2011, including New York, New Jersey and Pennsylvania. The rate increases for states that have not repaid their loans from the federal unemployment fund. The rate goes up .3% from .6% to .9% currently. Here is the timeline of what happened to the FUTA rate for 2011. From 1/1/2011 to 6/30/2011 the rate was .8%. From 7/1/2011 to 12/31/2011 the rate changed to .6%. Then at the end of November the DOL announced the retro rate adjustment for the 20 states. So now the rate needs to be retroactively adjusted from 1/1/2011 to 6/30/2011 to 1.1% and from 7/1/2011 to 12/31/2011 to .9%. Confused? You’re not the only one. This type of retroactive rate adjustment wrecks havoc on payroll systems. Digit Payroll must dedicate an additional 40 hours of development time and 60 hours of customer service time to handle the change.

Corporate Jargon

2011-12-07T19:03:42Z

Being in the small business world it is not yet an epidemic, but corporate jargon is unfortunately becoming more prolific. Like the late George Carlin in his 1972 monologue "Seven Words You Can Never Say on Television" here are 19 corporate jargon words you should never say anywhere.

Outside the Box
Low-hanging fruit
Synergy
Loop me in
Best of Breed
Incentivize
Mission-critical
Bring to the table
Value-add
Elevator pitch
Actionable Items
Proactive
Circle back
Bandwidth
High Level
Learnings
Next Steps
At the end of the day
Push back

So let's think outside the box, incetivize and be proactive to push back on the use of corporate jargon, then we can circle back at the end of day.

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FUTA Tax Decreases 0.02%

2011-10-03T19:41:25Z

It's not much but we take what we can get when it comes to decreased employer payroll taxes. The FUTA Tax is a Federal unemployment tax charged to employers on the first $7,000 of wages paid annually to each employee.

The FUTA tax rate will also be reduced for employers who are entitled to the maximum credit of 5.4%. This reduction applies to employers who pay their state unemployment in full, on time, and on the same wages that are subject to FUTA tax, provided the state is not determined to be a credit reduction state.

Effective July 1, 2011 the following changes will take place:

The FUTA tax rate will decrease to 6.0% from 6.2%

The FUTA tax rate after the maximum credit will decrease to 0.6% from 0.8%

This is a programming nightmare for payroll service bureaus. Although Digit Payroll Corp has successfully implemented the change.

Refer to IRS Publication 15 (2011) for more details.

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Get Milk or Get Fired!

2011-09-29T20:19:57Z

In a recent article in Life Inc., reported a CEO of a 60-person public relations firm, threaten to fire the next employee who didn’t replace the empty carton of milk for the office coffee. My first impression was this guy has too much time on his hands to worry about the milk. Small business owners are more concerned with bringing in the bread then buying the milk. The article goes on to state that the standing rule in the office is that the last person to finish the milk has an obligation to replace it (on the CEO’s dime). This has been a repeated problem and the CEO felt he had to address it in a rather scathing email to the staff.

The most surprising part of the article, besides the trivial issue at hand, was that 12% of the readers thought he was very wrong and 41% felt he was very right (and the balance in the middle). So the vast majority of the strong reader votes were in agreement with his actions. The common theme amount the strong supporters were that the culprits (milk non-replacers), are inconsiderate, selfish, lazy and disrespectful. They felt the punishment fit the crime.

So the next time you don’t replace the milk remember the way most people feel about you (not just the boss).

What Can You Get For Five Bucks?

2011-09-23T17:05:45Z

You can get your marketing plan reviewed, have a customized privacy policy written, have your press release reviewed, have a business card designed or have a small web site designed each for just five bucks. There are thousands of other things you can have done for you or your business for that price. Some a bit silly like having someone dance in a hotdog costume to the tune of your choice but others more serious. You say impossible, admittedly I was a bit skeptical myself but I couldn't resist giving it a shot.

The name of the web site is appropriately called Fiverr. People post their “gigs” for a fee of $5. I had a web site designed, a logo designed and some SEO work performed. I also wanted a computer program written but the seller reneged. The outcome? Well I have mixed reviews. The web site was a hit, the logo - not quite my cup of tie, and the jury is still out on the SEO work. But what the hay, it was only 5 bucks.

So give it a shot, what do you have to lose? 5 bucks!

2011 Proposed Jobs Creation Bill

2011-09-16T14:27:13Z

Much of the business knowledge processes and technical ability that I have gathered over the last 30 years of my business career has been garnered through mistakes and errors. It seems that if there is two ways to do something I inevitably pick the wrong way first time then figure out the right way and fix it. Call it bad luck, lack of proper research or lack of adequate advice that is just the way it has been. Even though this process is sometimes painful and time-consuming, the problem is eventually solved.

Last year the government put together a jobs creation bill in which they gave companies tax credits for hiring new employees. These tax credits could have accumulated into a nice bucket of cash, for small businesses. Digit Payroll telephoned, emailed and sent letters to their clients notifying them of this potentially lucrative proposition. Out of the thousands of small businesses that Digit Payroll is associated with and the tens of thousands of employees that these businesses employ, I am aware of maybe two businesses that the new employee credit was a factor in hiring a new employee. Many other businesses took advantage of the credit, but the credit was just a gift to them. These other businesses hired a new employee irrespective of the credit. Therefore the government gave away an enormous amount of tax dollars for very little benefit of adding additional people to the workforce.

Flash forward to 2011. A similar plan is being proposed. Albert Einstein defined insanity as “doing the same thing over and over again and expecting different results”. I think you get the point.

IRS Denies Tax Benefits for LLC Owners Hiring Their Children

2011-08-19T16:00:44Z

The general IRS rule is if a business owner of a sole proprietorship (not a corporation) hires his/her child under 18 years of age to work in his/her business, the child is not subject to social security, medicare, and FUTA payroll taxes. This is a huge benefit since these taxes could add up to 16% of the child’s pay. The pre-2009 practice, which made logical sense, was that since a single member LLC is treated as a sole proprietorship for income tax purposes, then the LLC could take advantage of this tax break.

Not any more, the IRS after 2009, has deemed the single member LLC as a proprietorship for federal income tax purposes and a corporation for federal employment taxes. A corporation is not entitled to this same benefit even if the sole owner is the parent of the employed child. Therefore this tax break does not apply to single owner LLC’s

The IRS and YouTube

2011-08-18T15:29:09Z

YouTube isn’t just for sharing family videos with friends anymore. Many businesses are using YouTube for instructional videos. In fact the IRS is jumping on the YouTube train and has posted 112 informational videos on YouTube. I have reviewed a few and they seem to give the viewer bare bones information concerning a specific topic. The researcher would still need to wade through the IRS instructions and publication to get the rest of the story.

Not only does the IRS use YouTube but they also use Twitter, Facebook, a smartphone app called IRS2Go, and audio files for Podcasts. Honestly, I still don’t get the whole twitter thing. I have enough problems keeping track of my own appointments, to-do lists, staff and family responsibilities then to care about what Lady Gaga is up to never mind a new IRS pronouncement. But then again, when I grew up social networking meant talking on a CB radio to neighbors and passing truckers. 10-4 good buddy!

Have we failed our childrens' generation?

2011-08-17T16:15:32Z

If you have children under the age of 25, you can’t seem to wonder whether they may be the first generation in decades to have less than what we have. Growing up in my teenage years in the 70’s and 80’s, my family did not have much money but yet I always had a job and pretty much bought anything that I wanted with the money I earned from student part time jobs. I bought a car at 17, paid for my own insurance, and could take my girl friend out (I paid) whenever I wanted to. I never really had to worry about money when I was a teenager. Besides a roof over my head and food on the table in my teenage years I was self supportive for just about everything else. I paid for most of my college education. At age 23 got married, bought a townhouse, and went on vacations to the Caribbean with friends. I wasn’t alone. Most of my friends did the same thing.

Why then do our children have such a tough time becoming financially independent and taking steps to increase the standard of living over their parents? Is it the economy, our parental teachings or a change in attitude? This Generation Y are described to be peer oriented due to Facebook, texting and other instant communication technologies and seek instant gratification.

This generation is facing higher costs for college and housing costs. Even though the housing building market for single family homes is down construction for multifamily (apartments) are up. This is an indication that Gen Y is more comfortable with renting rather than buying. Generation Y is more racially diverse, then are more likely to switch jobs or careers, about 1/3 depend on family financial support, only 58% pay their bills on time, 60% cashed out their 401(k) plans, and they more likely to wait longer to get married if at all.

Generation Y have different priorities than the Baby Boomers. That doesn’t mean we failed as the older generation. The line between work and social life is blurred for Gen Y’s. They like working with their friends. They want to spend their time in meaningful ways. Entrepreneurship is experimented with more frequently. They are young and smart, wear flip-flops to work and listen to iPods at their desk. They are high performers without high time spent at work. They are used to questioning their parents so they are now questioning their employers. Not necessarily a bad thing.

Is Work a Drudgery or an Adventure?

2011-08-17T14:32:51Z

Do you think making more money, having a nicer boss, having an unpopular co-worker transferred to another state, or working as a surf instructor on the beach would make you happier? According to Srikumar Rao, author of Happiness at Work “The exact attributes of what you are looking for do not exist in any job”. The feeling of being powerless and being the victim of circumstances is the greatest obstacle of happiness in the workplace. If you change your job the same feelings will eventually come back to haunt you if you don’t change the way you think about it. “The knowledge that we are responsible for living the life we have is our most powerful tool,” says Rao.

Rao is a little different than most self help instructors. He doesn’t preach “positive thinking”, he would rather his audience forget about looking at events or situations as “good or bad”. Instead he suggests adopting a “greater vision” perspective. Move from, if I got a raise I would be happy, to “I have a grand vision and I will try my best to make it work. If I succeed, wonderful. If not, wonderful. My purpose is to give it the best I got.”

Cloud Computing -- Is it For Me?

2011-05-04T16:09:00Z

Instead of installing software and data on your desktop computer or in house server, a web based application is used to access data stored off site. Business users do not need to worry about upgrading software, internal computing infrastructure is greatly reduced and users can access the application from virtually any where. Seems simple and inviting? Well yes and no. At first glance all the above brings many benefits, cost saving opportunities and possible efficiency boost to an organization. But like most business propositions, when it works as it is supposed to it is a good thing when it doesn't, well it doesn't.

Amazon's recent cloud server application went down for 4 days. If your company is dependent on computing power to generate revenue, that means your business is closed for 4 days with relatively no control to get it fixed. Your business becomes dependent and at the mercy of a third party service provider. Does that mean that cloud computing isn't a viable option to move mission critical applications? Planning and preparation is the key to mitigate damage control on an cloud computing outage situation.

Possible safety nets could mean having a back up in place. This may be internal back up or an alternative cloud back up. Perform due diligence on a prospective cloud provider. Check their data security and just as import plan for a data breach and how your organization would react to such a breach. Employees need to be educated concerning security of sensitive data. Since data can be accesses any where, employees should be aware of connecting to the business data through public computers or internet connections.

Although cloud computing brings many benefits to business computing, owners must be aware of the dangers and plan according before taking the leap.

Snow Storm?

2010-12-29T20:40:00Z

Sunday into Monday of this week eastern New Jersey was hammered with a snow storm, dumping 1 to 2 feet of slow in our area. If the snow wasn't enough strong wind gusts created snow drifts twice as high. Contemplating work on Sunday night I was preparing to go solo in the office on Monday. I only live one mile away from the office, so if I had to walk so be it.

Making my way into the office around 10 AM monday morning (it took be longer than I thought to dig out my car and rescue a stranded neighbor), I was surprised to see half the staff already in the office. By mid day we were at full staff, except for a few that were scheduled out anyway.

The postal mantra "Neither snow, nor rain, nor heat, nor gloom of night stays these courageous couriers from the swift completion of their appointed rounds" is really applicable to our staff. Our office has been open in snow storms, hurricanes, nor'easters and black outs (with the help of a generator). People need to get paid and darn it, it is our job to make sure they get paid.

I really try to avoid gushing about our company and the people that make everything happen, but we really are dedicated in providing outstanding service to our clients. We go beyond the call of duty to make them satisfied, sometimes to a fault. So the next time you're home because of some natural disaster, think of us. We are probably in the office working to process our clients' payroll.

2011 Payroll Withholding Tables Published

2010-12-17T17:25:00Z

On December 17, 2010 the IRS released the new payroll withholding tables for 2011. That gives employers and payroll service bureaus about 4 business days to update their systems (taking holidays into consideration). Payrolls are normally generated anywhere from 5 to 15 days in advance of paydate. Payroll systems are complicated, since there are many special tax rules that must be considered to insure the correct payroll tax withholding. Normally tax tables are published in the beginning of November for the next calender year.

The Double Standard:
Lawmakers can take 8 months to decide on the next year's tax structure, and when crunch time comes (November) take off an additional 2 weeks for Thanksgiving break. But yet the business community is given 4 days which in turn, forces technicians, programmers and testing groups to work 12 hour days, through the holidays and weekends to implement the new change.

Social Security Employee Tax Reduced for 2011

2010-12-17T17:21:00Z

Workers will see their take-home pay rise during 2011 because the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 provides a two percentage point payroll tax cut for employees, reducing their Social Security tax withholding rate from 6.2 percent to 4.2 percent of wages paid. This reduced Social Security withholding will have no effect on the employee’s future Social Security benefits

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HSA's, Are They For You?

2010-11-17T16:21:00Z

Essentially, HSAs operate like this: Individuals and businesses buy less expensive health insurance policies with high deductibles. Contributions to the accounts are made on a pre-tax basis. The money can accumulate year after year tax free, and be withdrawn tax free to pay for a variety of medical expenses such as doctor visits, prescriptions, chiropractic care and premiums for long-term-care insurance.

Participating employers can also contribute to accounts, on behalf of employees. HSAs enable self-employed people and businesses that currently do not have health insurance to utilize high-deductible plans with more affordable premiums.

If you're an eligible individual, you can cut your federal tax bills by making deductible HSA contributions. Even better, you can qualify regardless of your income, because there are no phase-out rules for high earners. However, you're allowed to make HSA contributions only if you're covered by a qualifying high-deductible health plan.

For the 2011 tax year, a plan must have a deductible of at least $1,200 for self-only coverage or $2,400 for family coverage to be considered a high deductible health plan (the same as 2010). A family plan covers anyone other than just yourself.

The maximum HSA contribution for 2011 is generally $3,050 for self-only coverage or $6,150 for family coverage (the same as 2010. However, these contribution maximums are increased by $1,000 if you are age 55 or older as of December 31, 2011 (to $4,050 for individual or $7,150 for family coverage).

Here are some of the advantages of HSAs:

---Depending on your federal income tax bracket, you can save between 10 and 35 percent of amounts contributed to your account.

---Every year, the money not spent can stay in the account and earn income tax-free, just like an IRA.

---Employers can contribute to employee accounts.

---Neither employers nor employees pay taxes on money contributed to HSAs.

---Lower health insurance costs mean more businesses can cover employees for major medical problems, such as hospitalization. Employees can use the accounts to cover doctors visits, lab tests and other costs.

--- Higher contribution limits and rollover privileges allow participants to get more money into their HSAs quickly to meet potential health care bills.

---HSAs are portable, meaning if employees change jobs, they can take the accounts with them.

Hiring Illegals

2010-11-17T15:57:00Z

There is a crackdown by the Immigration and Customs Enforcement agency (ICE) which took over enforcement from the Immigration and Naturalization Service (INS) in 2003, in businesses hiring illegal immigrants. This policy change was pushed through by Homeland Security. This means that instead of a more passive approach historically taken by the INS, by issuing small fines and a slap on the wrist, the ICE is aggressively pursuing criminal prosecution of employers.

By law, employers must complete an I-9 Employment Eligibility Verification form for each new hire within 3 business days of employment and keep the forms on file. Photocopy the documents provided by each employee. Maintain the copies with the I-9. Former employees' forms must be kept for three years from the hiring date or one year after termination, whichever is later.

Employers are generally not required to verify independent contractors or their workers. But there's a catch: If companies knowingly use subcontractors who employ unauthorized alien workers, they can expose themselves to potential I-9 violations.

An employer can face civil and criminal penalties for knowingly hiring illegal immigrants or failing to comply with the I-9 regulations. For example, fines for record keeping violations run from $100 to $1,000 each. Fines for knowingly employing an unauthorized alien range from $250 to $10,000 for each violation. Criminal penalties of up to $3,000 and up to six months in prison are possible if a pattern of hiring unauthorized workers is proved.

Federal investigators do routine audits of companies throughout the country, checking the I-9 forms that are supposed to be filled out for each U.S. worker. To protect your firm, here are some steps to take:

Accept documents that appear genuine. You aren't responsible for confirming their authenticity. You aren't expected to be an immigration expert, but you should have sufficient knowledge to understand if a document is consistent with an employee's claimed status.

Employers must complete the I-9 verification process within three business days of an employee's first day on the job. The only exception occurs when new employees lack a required piece of documentation and show a receipt proving they have applied for replacement documents. In such cases, all documents must be presented and the I-9 form completed within 90 days of the first day of work.

If the documentation is not produced, the person cannot continue to work. Your company can suspend the employee without pay until the documents are obtained. The Handbook For Employers contains detailed step by step instructions for completing Form I-9.

2011 Payroll Withholding Tables

2010-11-16T17:18:00Z

Normally, by now (middle of November) the IRS releases the new payroll withholding charts for the following year (2011). But Congress is not even close to agreeing on the tax rate structure for 2011. Here is a synopsis: Elections held November2; large turnover in party and Congressional members; first week is wasted on orientation and setting up leadership positions for new members; then they are off for Thanksgiving; that brings us to December. First they have to finalize rules for 2010 such as AMT exemptions, college tuition deductions, and sales tax deductions, and then tackle 2011 tax rates. So the treasury may be forced to issue payroll tax withholding tables based on higher tax rates (expired Bush tax cuts rates) which means less net pay for everyone.

The practical problem for payroll service bureaus and other tax professionals is that it takes time to reprogram software and code changes in tax law into their systems. So tax law changes that give very little time to implement or are retroactive will reap havoc on these providers who are trying to assist the general business community to be compliant with current tax laws.

Paper Federal Tax Payments Eliminated

2010-11-16T16:26:00Z

If you are currently making your federal payroll tax deposits by taking them directly to an authorized bank with a paper coupon, you should know that method will no longer be allowed as of January 1, 2011. Rules that permit federal tax deposits with paper coupons are being eliminated, and the Treasury Department is ceasing to maintain the coupon system. (Proposed Regulation 153340-09)

Digit Payroll offers an easy solution to the new mandated electronic payment regulation. Digit tax service automatically enrolls the company with EFTPS, makes all federal and state payroll tax payments for the client and files all payroll tax returns. Guaranteed to be accurate and timely.

If you choose to make online deposits, you must enroll in the Electronic Federal Tax Payment System (EFTPS).

It's all part of the federal government's initiative to increase the number of electronic transactions made by taxpayers. The IRS states that the paper coupon system that allows payments at 8,000 authorized financial institutions "dates back to World War I." Eliminating paper coupons is estimated to save at least $65 million over the first five years.

Information on EFTPS, including how to enroll, can be found at www.eftps.gov or by calling EFTPS Customer Service at 1-800-555-4477.

SBA and Google Launch "Tools for Online Success" Partnership

2010-05-12T14:49:00Z

SBA and Google Launch "Tools for Online Success" Partnership
U.S. Small Business Administration (SBA) and Google announced a new partnership and unveiled "Tools for Online Success," an array of online resources and training designed to help small business owners harness technology to grow their businesses. The site features tutorials, video testimonials, and tips from savvy small business people who have leveraged the web to become more efficient, more cost-effective, and more successful.

Click on the following link for more information and tutorials:

http://www.google.com/help/places/partners/sba/index.html ...