Critical Payroll and Tax Compliance Updates

April 2015

Treasury Releases Guidance on “Cadillac” Tax

On February 23 the Treasury issued Notice 2015–16 which includes guidance on the Affordable Care Act’s Excise Tax, also known as the “Cadillac” Tax.

Beginning in 2018, the IRS will impose a 40% excise tax on employers, health insurers, and/or plan administrators if the aggregate cost of employer-sponsored coverage for an employee, former employee, surviving spouse, or other primary insured individual exceeds a threshold limit. Notice 2015–16 provides guidance on which plans are subject to the high-cost plan excise tax, how to determine the cost of coverage, and how to apply the statutory dollar limit to the cost of coverage.

For a copy of the notice please visit: http://www.irs.gov/pub/irs-drop/n-15-16.pdf


IRS Releases Final Forms for Reporting Health Insurance Coverage

The IRS has released final versions of Forms 1094-C and 1095-C as well as the forms’ instructions. These forms will be used by employers to complete their reporting requirements under the Affordable Care Act (ACA), for tax years beginning in 2015.

Applicable Large Employers (ALEs) are required to file annual returns with the IRS to report health care coverage information for employees and their dependents. An ALE is an employer that employed an average of 50 or more full time or full time equivalent employees in the preceding calendar year. The first filing using these forms will be for the tax year 2015, and Form 1095-C must be provided to employees by January 31, 2016. The IRS copies of Form 1095-C as well as Form 1094-C must be filed in accordance with W-2 filing deadlines. For copies of the forms please visit our website here.


Washington DC Passes Wage Theft Prevention Amendment Act

In an effort to strengthen worker protection laws, the District of Columbia passed the Wage Theft Prevention Amendment Act of 2014. This act enhances the enforcement of wage payment and collection laws and places a greater accountability on employers.

Effective February 26, 2015, employers in Washington DC are required to provide a written notice to their employees at the time of hire which must contain employment information specific to the employee. In addition, employers must provide all current employees with the notice within 90 days of February 26. The employer must retain copies of the notices that are signed and dated by both the employer and employee. Employers not in compliance with this notification requirement may face penalties of up to $5,000 per employee.

The District of Columbia has provided a notice template which employers can use to fulfill their requirements under this law. The template can be found here.

For more information on this act please click here.

BDB is committed to keeping our clients up to date with the latest payroll developments. If you have any further questions regarding compliance with the DC Wage Theft Prevention Amendment Act, please contact your Client Services Representative today.


Form MTA-6 Discontinued for 2015

Effective for tax year 2015, self employed persons (including partners) who pay Metropolitan Commuter Transportation Mobility Tax (MCTMT) are required to make payments with their personal income tax return. Estimated MCTMT payments should be made with estimated personal income tax returns. Form MTA-6, which had been used by individuals paying MCTMT, will be discontinued for the year 2015.

These new rules do not affect MCTMT filings for businesses (Form MTA-305).

For more information please visit: http://www.tax.ny.gov/bus/mctmt/ind.htm