April 15, 2010

Ceridian leverages new HIRE Act changes so employers receive full benefits; continues monitoring legislative and regulatory tax changes so clients will realize full dollar value, maintain compliance with new laws

Minneapolis, April 15, 2010 - Ceridian Corporation, a leading provider of managed human resource, employee benefits administration, tax filing and payroll outsourcing solutions, continues to manage the far-reaching legislative and regulatory changes impacting employer tax compliance. Ceridian Tax Services help employers recognize the full value of all tax credits and new legislative and regulatory tax changes.

"Ceridian spends a great deal of time and effort making certain our clients receive the full tax value of new regulatory and legislative changes," commented Web Hill, senior vice president and general manager of Ceridian Tax Services. "Whether these tax benefits come from new health care reform legislation or recently enacted HIRE Act provisions, Ceridian continues to monitor and incorporate into all of our solutions tax-filing changes that insure our clients recognize the full benefits to which they're entitled."

Web Hill referenced the Hiring Incentives to Restore Employment (HIRE) Act of 2010, which provides two incentives employers can use to save money and stimulate employment:

• An employer Social Security tax exemption of 6.2 percent (.062) of Social Security wages paid to each qualified employee, and


• A retention tax credit of 6.2 percent of federal income taxable wages paid to each qualified employee, not to exceed $1,000

Ceridian is incorporating these important changes into all its solutions so our clients can take advantage of these and other important incentives. In general, these solutions enable employers to:

• Identify "qualified employees" in their payroll system


• Accumulate wages eligible for the employer Social Security (SS) tax exemption


• Provide underlying calculations and related periodic reporting in support of IRS Form 941 changes beginning in the second quarter of 2010


• Report the required information on W-2 forms

Ceridian also continues to monitor the far-reaching tax consequences of the recently passed health care reform legislation. Some of the health care tax policy changes which will, in one way or another, impact employers and their employees include:

• A provision effective 2011 that prohibits the reimbursement of over-the-counter drugs and medicine from Flexible Spending Accounts (FSAs) and related plans without supporting documentation, such as a physician's statement.


• Effective in 2013 a statutory cap of $2,500 will be placed on the amount of funds an employee can save in an FSA, similar to what is now in place for dependent care Flexible Spending Accounts.


• Also in 2013, individuals with adjusted modified gross income over $200,000, and joint filers with over $250,000, will be required to pay a Medicare surtax of 3.8 percent on investment and other unearned income, including rent, interest, dividends, royalties and capital gains.

"While these health care reform changes are still a ways off," concluded Web Hill, "Ceridian clients can rest assured we will be monitoring and insuring they take advantage of all their tax opportunities. During these rapidly changing regulatory times, Ceridian is managing employer tax credits, benefits and compliance requirements so our clients won't have to."

About Ceridian
Ceridian is a leading global business services company that provides reality-based KnowHow to take the guesswork out of impacting your organization's bottom line. From human resources and benefits to productivity and payroll services, we help organizations maximize their human, financial and technology resources. As a leader in payroll outsourcing, gift cards and corporate expense management, we're the driving force in payment innovation. Whether we're partnering with you to save money, grow your business, enhance operations or minimize financial risks we provide the insights and solutions that ensure your success. For more information about Ceridian visit www.ceridian.com or call 800-729-7655.