Tax Table Changes Included in this Payroll Update
 
Federal Tax Changes - 2009 Changes to Tax Tracking Types - 2009
State and Local Tax Changes - 2009    
 
Federal Tax Changes - 2009
 
Federal Withholding
New Federal income tax withholding tables, effective 1/1/2009. Annual withholding allowance increased to $3,650 from $3,500. (20901)
Social Security

 

Social security wage limit increased to $106,800 from $102,000. Rate is still 6.2%. (No change in Medicare.) (20901)
Advance Earned Income Credit (AEIC)

 

New Advance Earned Income Credit (AEIC) tables effective 1/1/2009. Filing status "Married Without Spouse Filing Certificate" is separated in the tables from filing status "Single or Head of Household." QuickBooks does not support this separated filing status. (20901)
   
 
State/Local Tax Changes - 2009
 
  If you are looking for information on particular state taxes and do not see it here, there is more information available by clicking here.
Alabama Hawaii Kentucky Missouri North Dakota South Dakota
Alaska Idaho Maine Montana Ohio Utah
Arizona Illinois Maryland Nevada Oklahoma Vermont
California Iowa Michigan New Jersey Oregon Washington
Connecticut Kansas Minnesota North Carolina Rhode Island Wisconsin
District of Columbia                 Wyoming
 
 
  Alabama
  Due to the Federal withholding tables changing, there may be a difference in Alabama withholding calculations, effective 1/1/2009. (20901)
     
  Alaska
  Wage limit for state unemployment insurance (UI) increased to $32,700 from $31,300. (20901)
     
  Arizona
  Due to the Federal withholding tables changing, there may be a difference in Arizona withholding calculations, effective 1/1/2009. (20901)
     
  California
  New withholding tables effective 1/1/2009. (20901)
  Wage limit for state disability insurance (SDI) increased to $90,669 from $86,698. (20901)
  State disability insurance (SDI) tax rate increased to 1.1% from 0.8%. (20901)
     
  Connecticut
  New withholding tables effective 1/1/2009. (20903)
   
  District of Columbia
  New withholding tables effective 1/1/2009. Annual withholding allowance increased to $1,750 from $1,675. (20902)
  QuickBooks has modified the programming of how the Filing Status label selections are displayed on the employee’s withholding State Tax Information slide in Payroll Setup and the Employee State Taxes tab in the Employee Center. These modifications were implemented to reflect the revised Employee Withholding Allowance Certificate, Form D-4; Line 1, Tax filing status. No action is required. (20902)
   
  Hawaii
  Wage limit for state disability insurance (SDI) has increased to $45,639.88 from $43,813.12. (20901)
   
  Idaho
  Wage limit for state unemployment insurance (SUI) and Workforce Development Fund (WDF) increased to $33,200 from $32,200. (20902)
  New withholding tables effective 1/1/2009. Annual withholding allowance increased to $3,650 from $3,500. (20901)
   
  Illinois
  Wage limit for state unemployment insurance (UI) increased to $12,300 from $12,000. (20901)
   
  Iowa
  Due to the Federal withholding tables changing, there may be a difference in Iowa withholding calculations, effective 1/1/2009. (20901)
  Wage limit for state unemployment insurance (UI), Admin. Surcharge, and Reserve Fund increased to $23,700 from $22,800. (20901)
     
  Kansas
QuickBooks implemented a change to the Kansas Withholding Tax Account Number format with Payroll Update 20901. It has been determined that a modification to the format allowed in QuickBooks is necessary. To accurately reflect the account number format for state withholding assigned by the agency, please verify your account number in QuickBooks is in the format of 999-#99999999Z99.
  Action Required: If you need to modify the account number reflected in your company file, please take the following steps: Refer to Form KW-5. Enter the current Account Number by selecting KS - Withholding from the Payroll Item List, click Next to get to the Agency for employee-paid liability screen. Enter the current Withholding Tax Account Number in the Enter the number that identifies you to agency box. Continue to click Next, and then click Finish.
  To accurately reflect the account number format for state withholding assigned by the agency, please verify the format is 999#999999999Z99. (20901)
  Action Required: If you need to modify the account number reflected in your company file, please take the following steps:  Refer to Form KW-5. Enter the current Account Number by selecting KS - Withholding from the Payroll Item List, click Next to get to the Agency for employee-paid liability screen. Enter the current Withholding Tax Account Number in the Enter the number that identifies you to agency box. Continue to click Next, and then click Finish. (20901)
     
  Kentucky
 

New withholding tables effective 1/1/2009. Standard deduction amount increased to $2,190 from $2,100. (20902)

     
  Maine
 

New withholding tables effective 1/1/2009. (20901)

     
  Maryland
The Comptroller of Maryland, Revenue Administration Division announced that the Maryland withholding tables will not change for wages paid on or after January 1, 2009. However, the county tax rate for Prince George will be changing to the 3.2% tables beginning January 1, 2009.
  Action Required: On or after January 1, 2009, but prior to creating paychecks for 2009, from the Employees menu, select Employee Center. Double click on an employee who is subject to Prince George County Tax. In the Change tabs drop down selection, select Payroll and Compensation Info. Click on the Taxes tab and then click on the State tab. Enter the 2009 Prince George County Tax Rate of 3.2% in the County % Rate box. Click OK twice. Be sure to change the county tax rate for all employees who are subject to the Prince George County Tax Rate.
     
  Michigan
  Unemployment Insurance Solvency Tax implemented for calendar year 2009.   The Solvency Tax is in addition to the assigned experience rate and shown as a separate line item on Form UIA 1771, Tax Rate Determination for Calendar Year 2009, if applicable.  Affected employers will add the Solvency Tax rate to their assigned Unemployment Insurance tax rate in QuickBooks.  For more information, please click here. (20902)
  Action Required:   From the Payroll Item List, select MI - Unemployment Company, click Next to get to the Company tax rates for 2009 screen.  Enter the total Company rate, which includes the Solvency Tax rate, in each of the Company rate boxes.  Continue to click Next, and then click Finish(20902)
 

New withholding tables effective 1/1/2009. Annual withholding allowance increased to $3,600 from $3,500. (20901)

     
  Minnesota
  New withholding tables effective 1/1/2009. Annual withholding allowance increased to $3,650 from $3,500. (20901)
  Wage limit for state unemployment insurance (UI) and Workforce Enhancement Fee (WEF) increased to $26,000 from $25,000. (20901)
     
  Missouri
New withholding tables effective 1/1/2009. Annual Allowances changing as follows:
Single or Married: to $2,100 for first and $1,200 each additional from $1,200 for the first and $1,200 each additional withholding allowance.
  Due to the Federal withholding tables changing, there may be a difference in Missouri withholding calculations, effective 1/1/2009. (20901)
  Wage limit for state unemployment insurance (UI) increased to $12,500 from $12,000. (20901)
     
  Montana
  Wage limit for state unemployment insurance (UI) and Admin. Fund Tax (AFT) increased to $25,100 from $23,800. (20901)
     
  Nevada
  Wage limit for state unemployment insurance (UI) and Career Enhancement Program (CEP) increased to $26,600 from $25,400. (20901)
     
  New Jersey
  A Family Leave Insurance (FLI) contribution has been enacted into law by the state and is now part of the 2009 tax table. It is a variable rate between 0.0% and 0.09% and has the same wage limit as the unemployment insurance of $28,900. Click here to see more information on this tax. (20903)
 

Action Required: From the Employees menu, select Pay Employees to trigger the Add New Tax Wizard . The Wizard will guide you through the setup process. If you have already set up a Custom Payroll Item for this particular tax, the Add New Tax Wizard will provide instructions on how to merge the Payroll Items.

Additional Frequently Asked Questions are provided on Payroll.com. (20903)

  Wage limit for state unemployment insurance (UI), Workforce Development/Supplemental Workforce Fund (WF/SWF), Health Care Subsidy (HCS), and state disability insurance (SDI) increased to $28,900 from $27,700. (20901)
     
  New Mexico
  New withholding tables effective 1/1/2009. Annual withholding allowance increased to $3,650 from $3,450. (20901)
 
Wage limit for state unemployment insurance (UI) increased to $20,900 from $19,900. (20901)
     
  North Carolina
  Wage limit for state unemployment insurance (UI) increased to $19,300 from $18,600. (20901)
     
  North Dakota
  New withholding tables effective 1/1/2009. Annual withholding allowance increased to $3,650 from $3,500. (20902)
  To accurately reflect the account number format for state withholding assigned by the agency, please verify the format is 99999999999. (20901)
  Action Required: If you need to modify the account number reflected in your company file, please take the following steps:  Refer to Form 306. Enter the current Identification Number by selecting ND - Withholding from the Payroll Item List, click Next to get to the Agency for employee-paid liability screen. Enter the current Withholding Identification Number in the Enter the number that identifies you to agency box. Continue to click Next, and then click Finish. (20901)
  Wage limit for state unemployment insurance (UI) increased to $23,700 from $22,100. (20901)
     
  Ohio
  New withholding tables effective 1/1/2009. (20902)
   
  Oklahoma
  New withholding tables effective 1/1/2009. (20902)
  Wage limit for state unemployment insurance (UI) increased to $14,200 from $13,600. (20901)
     
  Oregon
  For withholding tax, the annual exemption credit increased to $176 from $169. Federal tax subtraction limit increased to $5,850 from $5,600. Standard deduction for single filing status increased to $1,945 from $1,825 and for married filing status increased to $3,895 from $3,650. (20902)
  Oregon Lane Transit District rate increased to 0.65% from 0.64% effective 1/1/2009. (20901)
  Oregon Tri-Met Transit District rate increased to 0.6718% (rounded to 0.672% in QuickBooks) from 0.6618% (rounded to 0.662% in QuickBooks) effective 1/1/2009. QuickBooks supports only 3 decimal places, so the rate has been rounded up 0.672%. (20901)
  Wage limit for state unemployment insurance (UI) has increased to $31,300 from $30,200. (20901)
     
  Rhode Island
  New withholding tables effective 1/1/2009. Annual withholding allowance increased to $3,650 from $3,500. (20901)
  Wage limit for state unemployment insurance (UI) and Job Development Fund has increased to $18,000 from $14,000. (20901)
  Wage limit for state disability insurance (SDI) has increased to $56,000 from $54,400. (20901)
  State disability insurance (SDI) tax rate increased to 1.5% from 1.3% effective 1/1/2009. (20901)
     
  South Dakota
  Wage limit for state unemployment insurance (UI) and Investment Fee has increased to $9,500 from $9,000. (20901)
     
  Utah
  Wage limit for state unemployment insurance (UI) increased to $27,800 from $26,700. (20901)
   
  Vermont
  New withholding tables effective 1/1/2009. Annual withholding allowance increased to $3,650 from $3,500. (20902)
   
  Vermont
  New withholding tables effective 1/1/2009. Annual withholding allowance increased to $3,650 from $3,500. (20902)
   
  Washington
  Wage limit for state unemployment insurance (UI) and Employment Admin. Fund increased to $35,700 from $34,000. (20901)
   
  Wisconsin
  Wage limit for state unemployment insurance (UI) increased to $12,000 from $10,500. (20901)
   
  Wyoming
  Wage limit for state unemployment insurance (UI) increased to $21,500 from $20,100. (20901)
   
Changes to Tax Tracking Types - 2009
 
  Simple IRA

Annual deferral limit increased to $11,500 from $10,500. (20901)

  Section 457 Annual deferral limit increased to $16,500 from $15,500 for pension plans offered by state and local governments and tax-exempt organizations that fall under Internal Revenue Code Sections 457(b)(2) and (c)(1). (20901)
  Section 401(k) and designated Roth Contributions Annual deferral limit increased to $16,500 from $15,500. (20901)
 

Action Required: In the Payroll Item List, edit the Simple IRA Emp., Elective 457(b), 401(k) Emp., and Roth 401(k) Emp. payroll items to change the annual limit as listed above. In addition, to change the annual limits for the employee, edit the payroll setup for each employee for whom the limits apply. [ Note: If your 401(k) plan allows for designated Roth 401(k) elective deferrals, remember that the annual individual elective contribution limit (aggregate of all designated Roth contributions and traditional, pre-tax contributions) is $16,500 for 2009.] (20901)


Disclaimer: The information contained on these pages is meant to provide general information about the payroll process. It is not intended to provide comprehensive tax or legal advice and does not modify or extend the service guarantee to any Intuit product or service. You are responsible for consulting with your own professional tax advisor, accountant, and/or attorney concerning your business' specific concerns.