As 2020 is quickly coming to an end, we encourage you to review the questions below so that your year-end tax returns, W-2’s and 1095-C’s (for those clients subject to the Affordable Care Act) are accurate. If any changes are required please make updates in our online payroll solution, have your employees register and make their own updates in the employee portal, provide them to your Client Support Specialist or submit a support ticket by clicking here by no later than December 17, 2020.
- Do you wish to have the employees W-2’s delivered to a different address than we have on file?
- Have all manual and/or voided checks been processed?
- Will you be processing a separate bonus or other off-cycle payrolls in December?
- Do you plan on making any changes to your pay periods or checks dates in 2021?
- Do you need to update any employee information?
Will you be reporting any Fringe Benefits? If so, which of the following will you report?
- Personal use of a company vehicle
- Group-Term life insurance in excess of $50,000
- Non-qualified moving expense reimbursements
- Cost of Health Insurance provided to a 2% or greater owner of an S-Corp
- You issued more than 250 W-2’s in 2019 and must report the total premium cost of employer sponsored group health
- Third-party sick pay
For more information on fringe benefits please visit: https://www.irs.gov/forms-pubs/about-publication-15-b
- Is your company an Applicable Large Employer for purposes of the Affordable Care Act and would like Payality to prepare form 1095-C/1094-C?
- Will you process independent contractor payments in 2020 and would like Payality to prepare form 1099M?
Thursday Thanksgiving Day (Nov 26) – Payality Closed
Friday – Day after Thanksgiving (Nov 27) – Payality Closed
Thursday- Christmas Eve (Dec 24) – Payality Closed at 2 PM
Friday – Christmas Day (Dec 25) – Payality Closed
Wednesday (Dec 30) by Noon – Last day to submit payrolls to be included in 4th quarter and 2020 wages
Thursday (Dec 31) – Deadline for corrections to be made for ACA 1095C-s , W2s and 1099’s
Friday New Year’s Day (Jan 1, 2021) – Payality Closed
Monday (Jan 4, 2021) by Noon – Final date for backdated 2020 payrolls. Please Note: Anything reported after this deadline will require amendments and may result in penalties and/or interest that will be the clients sole responsibility. Additional charges for the amended returns will apply and amended returns/W-2c’s will begin being addressed in February 2021.
Friday (Jan 22, 2021) – 4th Quarter and 2020 Annual returns will be uploaded to the documents portal. W-2’s will be posted to the employee portal.
On or before Jan 26, 2021 – Paper copies of W-2’s will be sent to client for distribution to employees
Monday (Feb 1) -Most Quarterly and Annual Returns filings are due and W-2’s and 1099’s (and ACA 1095 c’s although like all previous years will likely be delayed) are due to employees/contractors.
2021 MINIMUM WAGE INCREASES
2021 California Minimum Wage
26 or More Employees – $14.00/hour
25 or Fewer Employees – $13.00/hour
Please note some cities/counties may have higher minimum wage requirements ( See below: subject to change)
Los Angeles and unincorporated areas of Los Angeles County (effective July 1, 2021)
26 or more employees $15.00/hour (unchanged)
25 or fewer employees $15.00/hour (up from $14.25)
San Francisco (Effective July 1, 2021)
All Size Employers $16.07/hour + CPI(not yet determined) up from $16.07/hour
San Jose (Effective January 1, 2021)
All size employers $15.45/hour (up from $15.25/hour)
San Diego (effective January 1, 2021)
All size employers $14/hour (up from $13.00)
Other California Cities
|City||Effective Date||2021 Minimum Wage All Size Employers||2021 Minimum Wage 26 or more employees||2021 Minimum Wage for 25 or fewer employees|
|Berkeley||Jul-21||$16.07 + CPI|
|Emeryville||Jul-21||$16.84 + CPI|
|Fremont||Jul-21||$15.00 + CPI||$15.00 (on July 1, 2021)|
|Half Moon Bay||Jan-21||$15.00|
|Malibu||Jan-21||$15.00||$15.00 (on July 1, 2021)|
|Milpitas||Jul-21||$15.40 + CPI|
|Mountain View||Jan-21||$16.05 + CPI|
|Oakland||Jan-21||$14.14 + CPI|
|Santa Monica||Jan-21||$15.00||$15.00 (on July 1, 2021)|
|South San Francisco||Jan-21||$15.24|
Click Here for Minimum Wage Laws by State
California Sick Pay Requirements
|State/City||Eligibility||Max Usage Per year||Accrual Method||Upfront Method|
|California||Any employee who works 30 or more days per year||24 hours or 3 days||1 hour for each 30 hours worked capped at 48 hours||24 hours within 120 days of employment|
|Berkeley||Any employee who works 2 hours or more per week in Berkeley||48 hours for employers with 24 or fewer employees. No cap for employers with 25 or more employees||1 hour for every 30 hours worked capped at 72 hours||N/A|
|Emeryville||Any employee who works 2 hours or more per week in Emeryville||48 hours for employers with 55 or fewer employees. 72 hours for employers with 56 or more employees||1 hour for every 30 hours worked capped at 48 for employers with 55 or fewer employees. 72 hours for 56 or more employees||48 hours upfront for employers with 55 or fewer employees. 72 hours for employers with 56 or more employees|
|Long Beach||Hotel employees||5 days||5/12th of a day for each month worked capped at 5 days per year||N/A|
|Los Angeles||Hotel Employees||96 hours||Each hour times 96 then divided by 52 for every week employment||N/A|
|Los Angeles||All other employees||72 hours||1 hour for every 30 hours worked capped at 48||48 hours upfront|
|Oakland||Any employee who works 2 hours or more per week in Oakland||40 hours for employers with 9 or fewer employees. 72 hours for employers with 10 or more employees||1 hour for every 30 hours worked capped at 40 for 9 or fewer employees. 72 hours for 10 or more employees||N/A|
|San Diego||Any employee who works 2 hours or more in city of San Deigo||40||1 hour for every 30 hours worked capped at 80 hours||40 hours upfront|
|San Francisco||Employees who work at least 56 hours in a calendar year||No Maximum||1 hour fo revery 30 hours worked capped at 40 with 9 or fewer employees. 72 hours for 10 or more employees||N/A|
|Santa Moncia||Any employee who works 2 hours or more in city of Santa Monica||No Maximum||1 hour for every 30 hours worked capped at 40 for employers with 25 or fewer emplopyees. 72 hours for 26 or more employees||N/A|
What’s New in 2021?
Sexual Harassment Training for All Employees
Sexual Harassment Prevention Training: SB 1343 (later amended to extend deadline) requires all California employers with five or more employees to provide two hours of sexual harassment training to supervisory staff and one hour of such training to non-supervisory staff within six months of hire or promotion into a supervisory role, and every two years after that by no later than January 1, 2021. Click Here for The California Department of Fair Employment and Housing free courses available in multiple languages
California State Disability Insurance rate remains at 1% with an increase in the wage base to $Not yet released (up from $122,909 in 2020)
Social Security Wage Base has increased to $142,800 (up from $137,700 in 2020)
401k Contribution Limit – $19,500 plus $6,500 make-up for those 50 or older
IRA Contribution Limit – $6,000 plus $1000 make-up for those 50 or older
Independent Contractor Versus Employee? AB 5 passed in October 2019 imposed sweeping guidelines and established that a worker is presumed to be an employee rather than an independent contractor unless the hiring entity can establish the following conditions are satisfied: The person is free from the control and direction of the hiring entity in connection with the performance of the work, both under the contract for the performance of the work and in fact. The person performs work that is outside the usual course of the hiring entity’s business. The person is customarily engaged in an independently established trade, occupation or business of the same nature as that involved in the work performed.
CalSavers and Retirement Plan Requirements: State law requires that California employers, who don’t already offer an employer-sponsored retirement plan and who have five or more employees, either sponsor a retirement plan or participate in CalSavers. The three-year phased roll-out will include staggered deadlines for registration based on employer size.
More than 100 employees – September 30, 2020
More than 50 employees – June 30, 2021
More than 5 Employees – June 30, 2022
Visit (CalSavers) For More Information
Per IRS Revenue Procedure 2012-32, we’d like to remind you that authorizing Payality Inc. to file your returns and make your federal tax deposits does not relieve you of the obligation of ensuring that the returns and deposits are filed timely. Our promise to you is that we will file your returns and deposit your tax liability by every applicable due date. However, please remember that it is ultimately your responsibility to verify the accuracy of the returns and deposits we submit on your behalf. The IRS recommends that you enroll in and use EFTPS to ascertain whether we, as your Reporting Agent authorized on Form 8655, have made all deposits timely and accurately. If at any time you find that data has been reported incorrectly or untimely, please contact your Client Support Specialist as soon as possible in order for us to make the necessary corrections