HIRE Act Update
Wednesday, June 16, 2010
The primary focus of the HIRE Act legislation is to accelerate the hiring of unemployed workers. It has provisions that affect employers, including a payroll tax exemption. The provisions include reduced payroll taxes and increased tax credits for employers that meet certain eligibility requirements.
All eligible employees must complete a Form W-11, Hiring Incentives to Restore Employment (HIRE) Act Employee Affidavit, to confirm that they are qualified employees under the HIRE Act.
We will be addressing the HIRE Act in both Abra Suite and in Abra SQL, with updates available in the Q2 Tax Update. Here is an update of what Sage is planning to provide:
1. A new field, HIRE Act Qualified Employee, has been added to allow you to indicate an eligible employee (per the qualifications on the HIRE Act). This field has also been added to the Data Dictionary so you can use it with the Expression Builder, Abra Query, and Crystal Reports®.
2. For eligible employees the system will add new tax codes that will accumulate the taxable wages that are eligible for the credit. These tax codes will be used to populate the 941 and year-end reporting.
3. All standard reporting will display the correct employer liability based on the eligible wages once the update is applied.
4. The 941 form and Worksheet, Pre-Close form, and the Edit Quarter/Year End user interface will be updated based on the new 941 form issued by IRS.
o The Sage Abra user will have the ability to adjust the 941 form to record the taxable wages for Q1 that are eligible for the tax credit.
5. The Trial Quarter Close and Final Quarter Close processes will be updated to include the new 941 form requirements.
6. Necessary changes for Year End reporting, including the required W-2 and W-3 changes are planned to be included in the Q4 Tax Update.
Abra SQL HRMS (Payroll)
1. A new field, HIRE Act Qualified Employee has been added to Employee Tax UI.
2. 2When the Sage Abra user calculates payroll for an exempt employee the employer portion of U.S. Social Security will not be calculated.
3. The line representing the Employer Portion of USSS will not appear on the Pre-Check Register and the Payroll Register reports.
4. The 941 form will be updated based on the new 941 form issued by IRS.
5. Necessary changes for Year End reporting are planned to be included in the Q4 Tax Update.