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January 2011 Newsletter
Introduction
Welcome to the first edition of WorkSmart a publication provided by HR Performance Group, Inc. This monthly newsletter is designed to bring value-added information and tools to help you link your human capital to bottom line success. Each issue will include legal updates and useful practitioner tools to assist you in all aspects of human capital: performance management, organizational structure, benefit plan implementation, compensation, change management, compliance, and employee communications.
Structuring your organization with the right people, processes and systems is among most business leaders top priorities. Doing so effectively provides the proper foundation for future
success. Executives who are better aligning the organization and linking people to business results, are stepping into action and creating their own futures. At HRPG we help you make this happen. Be a part of this group of effective executives who WorkSmart!
John Andrew
HR Performance Group, Inc.
The Ever Shifting Sea…
2011 Tax Rates and Benefit Changes
The only thing you can count on is change. Here is the skinny on important moves in taxes and benefits for 2011:
FICA - Social Security |
Employer Rate
6.2%
Employee Rate
4.2% |
Wage Base Limit $106,800 |
FICA - Medicare |
Employer Rate
1.45%
Employee Rate
1.45% |
No Wage Base Limits |
FUTA -
Federal Unemployment Tax Act |
0.8% (after credit) |
Wage Base Limit
$7,000 |
IL UI tax Contributions |
Minimum Rate
0.700%
Maximum Rate
8.400% |
Wage Base Limit
$12,740 |
Elective Deferral (Contribution) Limit |
401(k) Limit
$16,500 |
Annual Total Limit
$49,000 |
Health Savings Account
Contribution Limit |
Single Level
$3,050
Family Level
$6,150 |
Catch Up Contributions (Age 55 or older)
$1,000
New Receipt Requirements |
Minimum Wage Rates |
IL State Wage
$8.25 per hour |
Federal Wage
$7.25 per hour |
Significant Changes for 2011
- The IRS has issued proposed regulations that provide that beginning January 1, 2011, taxpayers must deposit all depository taxes (such as employment tax, excise tax, and corporate income tax) electronically using the Electronic Federal Tax Payment System (EFTPS). Under these proposed regulations, Forms 8109 and 8109-B, Federal Tax Deposit Coupon, cannot be used after December 31, 2010.
- Flexible Spending Account (FSA) Update – The IRS has recently changed the rules which impact what is needed as documentation when requesting reimbursement for over the counter (OTC) medicine and drug purchases as part of a FSA. Effective January 1, 2011 participants will be asked to submit proof of a doctor’s prescription for OTC medicine and prescription drug purchases. This documentation can be either
- A receipt that identifies the purchaser along with an RX number; or
- A receipt showing the item purchased along with a copy of the prescription.
- Debit cards may no longer be used to purchase OTC medicines and drugs at certified IIAS merchants. You will need to use another form of payment at these locations and submit the expense via online, fax or mail. Debit cards may continue to be used for the payment of other OTC items not classified as medicines and drugs. Over 27,000 OTC items remain on the list for purchase without prescription.
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