FEDERAL AND STATE TAX CHANGES FOR 2013

Please click the title of this article to read about upcoming tax changes for 2013.
State tax tables for New York and North Dakota will change effective January, 2013. ?_For OpenRDA/Xpert customers, those tables are incorporated into the payroll program code that was released December 19, 2012. ?_ You will then be able to update these state tax tables (along with changes to exemption amounts and standard deductions) directly from the state deduction description once the last payroll for 2012 has been completed and finalized. ?_These tables will also be published on our website (accessed via Help, Manuals / Documentation) later this month.
Unemployment wage bases (thresholds) are changing for several states in 2013 and documentation/instructions have been published on our website. ?_Since the wage bases are used when completing quarterly unemployment reports, the thresholds should not be changed until after the 4th quarter, 2012 report is completed.
Although it is not known yet whether the reduced employee FICA rate will be extended for 2013 (indications are that it will not be extended as it is not part of the fiscal cliff negotiations), it is known that the FICA wage base will increase from?_$110,100 to $113,700. ?_Also, an additional Medicare tax (0.9 percent) will be effective in 2013. ?_This additional tax will only apply to taxable wages that are in excess of $200,000 and is only for the?_employee?_share. ?_As a result of this change, the?_MEDICARE?_deduction description will require a custom configuration (will compute based on year-to-date taxable Medicare wages; 1.45 for the first $200,000 and an additional .9 percent once that amount is exceeded). ?_This custom configuration can also be implemented from the Medicare deduction description (with 01/15/2013 or later programs).
Once 2013 federal tax tables are released by the IRS, documentation/instructions will be available and announced in RDA News.