Wyoming Corporate Officer Wage Increased For 2007
Wyoming has increased its quarterly average wage by $564.49, from $7,882.26 to $8,446.75. The average wage figure is used instead of actual wages for reporting worker's compensation (WC) wages for corporate officers. Employers are reminded that actual wages must be used for quarterly unemployment compensation (UC) reporting purposes.

This change is officially effective 1/1/2007. The Wyoming Workers' Safety and Compensation division has updated its Corporate Officer / LLC Member Average Wage table.

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Hawaii UI Wage Base and Employment & Training Tax Increase for 2007
Hawaii increased its enemployment insurance (UI) wage base by $1,300, from $34,000 to $35,300 for 2007.

In addition to employer unemployment insurance taxes, the UI wage base also applies to the Hawaii Employment and Training (E & T) Tax. The Hawaii E & T tax is employer-only. Although the tax is based on hawaii employee UI wages, no employee tax may be withheld. The Employment and Training tax rate remains .01% (.0001) of UI wages. As a result, the maximum annual Employment and Training tax increases by $0.13, from $3.40 to $3.53 for each employee in 2007.

The Hawaii Department of Labor and Industrial Relations has updated its contribution rates publication with details of these changes.

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Rhode Island Income Tax Withholding Decrease for 2007
Rhode Island increased the annual deduction allowed for each exemption by $100, from $3,300 to $3,400. In addition, the state increased the upper wage threshold in all of its income tax withholding brackets except the first one.

The Rhode Island Division of Taxation has published authoritative information on this change in an excerpt of its withholding tax booklet.

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Missouri Income Tax Withholding Decrease effective 1/1/07
Missouri increased the annual standard deduction for single employees and for married employees whose spouse also works by $200, from $5,150 to $5,350. The state increased the standard deduction for married employees whose spouses do not work by $400, from $10,300 to $10,700. The standard deduction for head of household employees increased by $300, from $7,550 to $7,850.

Details can be found in the State of Missouri Employer's Tax Guide.

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Colorado Withholding Tax Decrease effective 1/1/07
Colorado increased the annual deduction allowed for each exemption by $100, from $3,300 to $3,400. In addition, the state increased the amount of taxable income that can be earned before any withholding taxes apply.

Details can be found in the Colorado Income Tax Withholding Tables for Employers.

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Massachusetts Income Tax Withholding Decrease effective 1/1/07
Massachusetts increased the annual deduction available to employees who claim exemptions by $275, from $2,850 to $3,125. In addition, the state increased the annual credit available to head of household employees by $7.95, from $111.30 to $119.25.

Details can be found in the State of Massachusetts' Percentage Method for Wages Paid (Circular M) document.

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Vermont Income Tax Withholding Decrease
Vermont increased the annual amount allowed for each exemption by $100, from $3,300 to $3,400. In addition, the state increased the upper wage threshold in each withholding bracket except the first one. Since the withholding rates increase as annualized wages increase, the higher upper threshold in the wage brackets results in more income being taxed at a lower rate before the next higher rate applies. For most workers, these changes result in lower Vermont withholding taxes for 2007.
This change is officially effective 1/1/2007. The Vermont Department of Taxes has published details of this change and additional withholding guidance on its web site under Business Taxes.

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IRS Releases Amounts Exempt From Levy for 2007
In its Publication 1494, the Internal Revenue Service (IRS) has released the amount of an individuals income that is exempt from a federal levy used to collect delinguent tax in 2007. The exempt amounts vary based on the employee's apy frequency and filing status.
Employers should keep in mind that the new tables may not be applied on levies issued prior to 2007 unless affected employees submit a new statement of exemption and filing status in 2007.
This change is officially effective 1/1/2007. Authoritative information on it can be found in IRS Publication 1494.

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Alaska Employee Unemployment Insurance Tax Increase for 2007
Alaska increased the maximum taxable wages subject to unemployment insurance (UI) tax by $1,400, from $28,700 to $30,100 for 2007. The maximum subject wages is referred to as the taxable wage base. In addition, the state decreased the employee withholding rate from .51% to .50% (.005) for 2006. As a result of these changes, the maximum annual amount of employee withholding tax will increase from $146.37 in 2006, to $150.50 in 2007.
This change is officially effective 1/1/2007. Authoritative details of it can be found on the Alaska Department of Labor and Workforce Development's web site under Employment Security Tax.

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Rhode Island Employee Disability Insurance Tax Decrease for 2007
Rhode Island increased its disability insurance (DI) wage base by $1,500, from $50,600 for 2006 to $52,100 for 2007. Conversely, the state reduced the employee disability insurance rate from 1.4% (.014) for 2006 to 1.3% (.013) for 2007. As a result of these changes, Rhode Island employee disability insurance taxes will decrease by up to $31.10, from a maximum of $708.40 in 2006 to a maximum of $677.30 in 2007.
This change, which was communicated to Ceridian in an e-mail from the state, has not yet been posted to the Rhode Island's web site. When posted, the information should be included under Rhode Island Temporary Disability Insurance frequently asked questions.

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Oregon Workers' Compensation Benefit Fund Assessment Decrease for 2007
The Oregon Department of Consumer and Business Services (DCBS) announced that the Oregon workers' compensation benefit fund assessessment decreased from $0.030 per hour to $0.028 per hour for 2007. Oregon employers may withhold up to one half of the tax, or $0.014 per hour, from subject employees.
The Oregon DCBS has published this information on its web site under 2007 WC rate information.

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North Carolina SIT Withholding Decrease
The North Carolina Department of Revenue cut the top rate in each of its income tax withholding tables by .25%, from 8.25% to 8.00%. The standard deduction and the annual deduction allowed for each exemption, which varies depending on the employee's withholding status and annualized wages, are unchanged.
This change is officially effective 1/1/2007. The revised withholding tax rates are included in North Carolina Publication NC-30, Income Tax Withholding Tables and Instructions for Employers.

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Lane County, Oregon, Transit District Tax Increase for 2007
The Lane County Oregon Transit District increased its employer only transit district tax rate from .60% (.006) to .62% (.0062).
This change is officially effective 1/1/2007. The Oregon Department of Revenue has posted Lane's rate update for 2007 under Transit Payroll Taxes for Employers.

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Oregon SIT Withholding Decrease
Oregon increased the annual credit allowed for each exemption by $6, from $159 to $165. In addition, the state increased the maximum annual federal tax deduction by $500, from $5,000 to $5,500. Finally, the state modified the withholding tables and added new standard deductions of $1,870 for single employees and $3,740 for married employees. These changes result in lower withholding taxes for Oregon employees.
This change is officially effective 1/1/2007. The Oregon Department of Revenue has posted a link to the updated withholding tax tables on its Oregon Withholding Tax web page.

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Hawaii Employee Weekly Disability Insurance Tax Increase for 2007
The Hawaii Department of Labor and Industrial Relations increased the maximum amount of weekly wages subject to the state's temporary disability insurance tax by $28.56, from $791.70 to $820.26. The employee withholding rate remains 0.5% (.005).
As a result of the wage base increase, the maximum amount of tax that a Hawaii employee will pay on a weekly basis increased by $0.14, from $3.96 in 2006 to $4.10 in 2007.
The Hawaii Disability Compensation Division has released the updated maximum weekly wage base and the corresponding employee weekly withholding rate on its web site under Miscellaneous Guidelines.

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Federal Income Tax Decrease, Effective 1/01/07
The Internal Revenue Service (IRS) increased the annual amount allowed for each exemption by $100, from $3,300 to $3,400. In addition, the IRS increased the range of wages in each withholding bracket except the first. Since the withholding rates increase as annualized wages increase, the broader wage brackets results in more income being taxed at a lower rate before the next higher rate applies. For most workers, these changes result in lower federal withholding taxes for 2007.
This change is officially effective 1/1/2007. The IRS supplied this early federal income tax withholding information in Notice 1036. As in prior years, the IRS will release more complete withholding guidance for 2007 later this year in Publication 15, Circular E.

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Federal Advance Earned Income Credit Increase, Effective 1/01/07
The Internal Revenue Service (IRS) increased the federal advance earned income credit (EIC) for 2007. The maximum credit available to single employees, and married employees where only one spouse requests the credit, increased by $64, from $1,648 to $1,712.
The credit available to married employees where each spouse requests it increased by $32, from $824 to $856.
The IRS's changes are officially effective 1/1/2007. The IRS supplied this early federal income tax advance earned income credit calculation information in Notice 1036. As in prior years, the IRS will release more complete guidance for 2007 later this year in Publication 15, Circular E.

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IRS Notice 2006-100 Affirms Aspects of Section 409A Nonqualified Plan Requirements
On November 30, 2006, the IRS released additional guidance on Reporting and Wage Reporting under Internal Revenue Code (IRC) Section 409A in Notice 2006-100. The long-awaited guidance provides relief on a portion of the requirements but affirms other aspects thereof. Additional guidance will be issued on calculating the amount of deferred compensation to report for various deferred compensation plan types.

Read more about it.

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State minimum wage increases effective January 1, 2007
Eighteen states will have minimum wage increases effective January 1, 2007. The new wage rates apply to most workers, however, alternate rates may apply in some situations (i.e. tipped employees, training wages, workers under the age of 18). Links to state information and the 2007 minimum wage rates are listed below.

	Arizona	- $6.75 per hour
	California	- $7.50 per hour
	Colorado	- $6.85 per hour
	Connecticut	- $7.65 per hour
	Delaware	- $6.65 per hour
	Florida	- $6.67 per hour
	Hawaii	- $7.25 per hour
	Massachusetts	- $7.50 per hour
	Missouri	- $6.50 per hour
	Montana	- $6.15 per hour
	New York	- $7.15 per hour
	North Carolina	- $6.15 per hour
	Ohio	- $6.85 per hour
	Oregon	- $7.80 per hour
	Pennsylvania	- $6.25 per hour
	Rhode Island	- $7.40 per hour
	Vermont	- $7.53 per hour
	Washington	- $7.93 per hour

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Related Compliance Resources
2008 Wage & Tax Advisory Guides: Now available online

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ELLA.asp

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Federal Compliance Thresholds: See which statutes apply to you

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