QuickBooks - Tax Table Changes

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 COBRA Subsidy Credit
	For employers that will be paying the 65% COBRA subsidy for assistance-eligible individuals, a provision in the American Recovery and Reinvestment Act of 2009 (ARRA), a new payroll item called US – COBRA Subsidy Credit will be supported in QuickBooks. (20910)
	Action Required: If you are an employer paying 65% COBRA subsidies, please refer to the document COBRA Premium Subsidy Guide for QuickBooks for detailed instructions on how to set up this new payroll item in QuickBooks. (20910)
	Please visit the IRS website for more information regarding the COBRA Health Insurance Continuation of Premium Subsidy tax provision in the American Recovery and Reinvestment Act of 2009. (20910)
Federal Withholding
	New Federal income tax withholding tables are effective with Payroll Update 20908, released on 3/12/2009. New tables were developed by the Internal Revenue Service (IRS) to help employers implement the withholding adjustments required for the Making Work Pay Tax Credit provision of the American Recovery and Reinvestment Act of 2009 (ARRA). The new tables were developed to apply for withholding for all employees and to take into account all current tax provisions. (20908)
	Note: Your employees do not need to fill out a new Form W-4. However, an employee with multiple jobs or married couples whose combined incomes place them in a higher tax bracket may elect to submit a revised Form W-4 to ensure there is enough withholding to cover the tax for his or her combined income. (20908)
	Please visit the IRS website for more information regarding the tax provisions in the American Recovery and Reinvestment Act of 2009, click here. (20908)
	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) table for “Married With Both Spouses Filing Certificate” is effective with Payroll Update 20908, released on 3/12/2009. A new AEIC table was developed by the Internal Revenue Service (IRS) due to the changes to the tax law (Temporary Increase In Earned Income Tax Credit provision) made in the American Recovery and Reinvestment Act of 2009 (ARRA). (20908)
	Note: A new AEIC table for “Married Without Spouse Filing Certificate” was also developed by the IRS, but QuickBooks does not support this separate filing status. (20908)
	Please visit the IRS website for more information regarding the tax provisions in the American Recovery and Reinvestment Act of 2009, click here. (20908)
	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	Maine	New Hampshire	Oklahoma	Vermont
Alaska	Idaho	Maryland	New Jersey	Oregon	Washington
Arizona	Illinois	Michigan	New Mexico	Rhode Island	West Virginia
California	Iowa	Minnesota	New York	South Carolina	Wisconsin
Colorado	Kansas	Missouri	North Carolina	South Dakota	Wyoming
Connecticut	Kentucky	Montana	North Dakota	Tennessee
District of Columbia	Louisiana	Nevada	Ohio	Utah

	Alabama
	To accurately reflect the account number format for unemployment insurance assigned by the agency, please verify the format is #999999999. (20918)
	Action Required : Take the following steps if you need to modify the account number reflected in your company file. Refer to Form A-6, A-1 or A-3. Enter the current account number by selecting AL – Withholding from the Payroll Item List. Click Next to get to the Agency for employee-paid liability screen. Enter the current Ala Withholding Tax Account No. in the Enter the number that identifies you to the agency box. Continue to click Next and then click Finish. (20918)
	Due to the Federal withholding tables changing, there may be a difference in Alabama withholding calculations effective with Payroll Update 20908, released on 3/12/2009. (20908)
	Due to the Federal withholding tables changing, there may be a difference in Alabama withholding calculations, effective 1/1/2009. (20901)

	Alaska
	Revised Geographic Codes effective June 30, 2009.Click here to see the updated Alaska Occupational Coding Manual which includes the revised geographic codes on page 2. (20918)
	Action Required: From the Employees menu, select Payroll Setup. Go to Employee Setup and click on Employee List. On the Review your employee list screen, highlight an applicable employee and click Edit. Click Next until you get to the Setup geographic and occupational information screen, select the appropriate Geographic Code, and then click Finish. (20918)
	Wage limit for state unemployment insurance (UI) increased to $32,700 from $31,300. (20901)
	QuickBooks 2009 R4 or higher now supports the Alaska Geographic and Occupational Codes through the Payroll Setup feature. The codes are reported on Form TQ01C, Alaska Quarterly Contribution Report. (20901)
	QuickBooks Assisted Payroll subscribers: There is no change to the tax filing service for Assisted Payroll customers who have Alaska unemployment insurance tax returns filed on their behalf. Assisted Payroll customers will now have the ability to enter the Geographic and Occupational Codes for their employees. (20901)
	Action Required: From the Employees menu, select Payroll Setup. Go to Employee Setup and click on Employee List. On the Review your employee list screen, highlight an applicable employee and click Edit. Click Next until you get to the Setup geographic and occupational information screen, select the appropriate Geographic Code, enter the appropriate Occupational Code in the applicable field, and then click Finish. (20901)

	Arizona
	New withholding rates effective 5/1/2009. The withholding rates are changing from 10%, 19%, 23%, 25%, 31%, and 37%, to 11.5%, 21.9%, 26.5%, 28.8%, 35.7%, and 42.6%, respectively. (20912)
	Action Required: For each employee affected, from the Employees menu select Employee Center. Double click on an applicable employee, select Payroll and Compensation Info in the Change tabs drop down selection, and then click on the Taxes tab. Click on the State tab and then select the applicable Withholding Rate in the drop down selection under the Miscellaneous Data section. Change the Withholding Rate as indicated on the employee's most current Arizona Form A-4 or Form A-4V. Repeat the steps above for each applicable employee. IMPORTANT: New withholding rates must be selected for each applicable employee in order for Arizona withholding tax to continue to calculate in 2009. (20912)
	Due to the Federal withholding tables changing, there may be a difference in Arizona withholding calculations effective with Payroll Update 20908, released on 3/12/2009. (20908)
	Due to the Federal withholding tables changing, there may be a difference in Arizona withholding calculations, effective 1/1/2009. (20901)

	California
	Revised withholding tables effective 1/1/2009. (20911)
	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)
	QuickBooks 2009 R4 or higher now supports the California Wage Plan Codes through the Payroll Setup feature. For Enhanced Payroll subscribers using our E-File and Pay service, the Wage Plan Codes will report on the electronic filing of Form DE 6, Quarterly Wage and Withholding Report. (20901)
	QuickBooks Assisted Payroll subscribers: There is no change to the tax filing service for Assisted Payroll customers who have California tax returns filed on their behalf. Assisted Payroll customers will now have the ability to enter the Wage Plan Codes for their employees. (20901)
	Action Required: From the Employees menu, select Payroll Setup. Go to Employee Setup and click on Employee List. On the Review your employee list screen, highlight an applicable employee and click Edit. Click Next until you get to the Setup wage plan information screen, select the appropriate Wage Plan Code, and then click Finish. (20901)

	Colorado
	New withholding tables effective 1/1/2009. Annual withholding allowance increased to $3,650 from $3,400. (20913)

	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
	New withholding tables effective 1/1/2009. (20917)
	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 with Payroll Update 20908, released on 3/12/2009. (20908)
	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. (20904)
	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. (20904)
	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)

	Louisiana
	New withholding tables effective 7/1/2009. (20916)

	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. (20904)
	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. (20904)

	Michigan
	IMPORTANT UPDATE: The Unemployment Insurance Solvency Tax implemented for calendar year 2009 has been suspended. The Solvency Tax was 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. In a prior Payroll Update (20902), affected employers were instructed to add the Solvency Tax rate to their assigned Unemployment Insurance tax rate in QuickBooks. For more information, please click here. (20909)
	Action Required: If you have received notification from the agency of a revised UI tax rate for 2009, please take the following steps: 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 in each of the Company rate boxes. Continue to click Next, and then click Finish. (20909)
	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
	Minnesota Workforce Enhancement Fee rate increased to 0.12% from 0.10% effective 7/01/2009. (20917)
	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
	Due to the Federal withholding tables changing, there may be a difference in Missouri withholding calculations effective with Payroll Update 20908, released on 3/12/2009. (20908)
	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. (20904)
	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 Hampshire
	Emergency Power Surcharge rate effective 04/01/2009. The Emergency Power Surcharge is in addition to both the assigned experience rate and the new employer rate. Affected employers will add the Emergency Power Surcharge rate to their assigned Unemployment Insurance tax rate in QuickBooks. For more information, please click here. (20916)
	Action Required: From the Payroll Item List, select NH - Unemployment Company, click Next to get to the Company tax rates for 2009 screen. Enter the total Company rate, which includes the Emergency Power Surcharge rate, in each of the following Company rate boxes: For 4/1 – 6/30, For 7/1 – 9/30, and For 10/1 – 12/31. Continue to click Next, and then click Finish. (20916)

	New Jersey
	New withholding tables effective 1/1/2009.
	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)

	New York
	Revised withholding tables effective 5/1/2009. (20912)
	Note: Form IT-2104, Employee's Withholding Allowance Certification (Rev. 4/09), has also been revised to reflect the legislative changes. Employers should encourage employees in certain instances (such as employees who have more than one job, or married employees if both spouses work) to complete the revised Form IT-2104 to prevent under-withholding for New York State and Yonkers residents to ensure that the proper amount of tax is withheld for 2009. (20912)

	North Carolina
	Wage limit for state unemployment insurance (UI) increased to $19,300 from $18,600. (20901)

	North Dakota
	Revised withholding tables effective 1/1/2009. (20916)
	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
	Due to the Federal withholding tables changing, there may be a difference in Oregon withholding calculations effective with Payroll Update 20908, released on 3/12/2009. (20908)
	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 Carolina
	To accurately reflect the account number format for unemployment insurance assigned by the agency, please verify the format is 0999999 or 0099999. (20908)
	Action Required: If you need to modify the account number reflected in your company file, please take the following steps: Refer to Form UCE-101. Enter the current SCESC ACCT NO. by selecting SC – Unemployment Company from the Payroll Item List, click Next to get to the Agency for company-paid liability screen. Enter the current SCESC ACCT NO. in the Enter the number that identifies you to agency box. Continue to click Next, and then click Finish. Then, from the Payroll Item List , select SC – Contingency Assessment. Click Next to get to the Agency for company-paid liability screen. Enter the current SCESC ACCT NO. in the Enter the number that identifies you to agency box. Continue to click Next, and then click Finish. (20908)

	South Dakota
	Wage limit for state unemployment insurance (UI) and Investment Fee has increased to $9,500 from $9,000. (20901)

	Tennessee
	Wage limit for state unemployment insurance (UI) has increased to $9,000 from $7,000. (20918)
	Action Required: For more information on action required steps, click here. (20918)
	The Temporary Additional Fee of 0.60% is effective 01/01/2009. New employers subject to the standard new employer rate of 2.7% are not affected by the rate increase. Affected employers will add the Temporary Additional Fee rate to their assigned Unemployment Insurance tax rate in QuickBooks. For more information, click here. (20918)
	Action Required: Add the Temporary Additional Fee rate of 0.60% to the UI tax rate for 2009 and take the following steps: From the Payroll Item List, select TN – Unemployment Company, click Next, to get to the Company tax rates for 2009 screen. Enter your new Company rate in each of the Company rate boxes. Continue to click Next, and then click Finish. (20918)
	QuickBooks Assisted Payroll subscribers: If you have not already done so, please contact us at (888) 712-9702 to make the necessary adjustments in your QuickBooks to change your Company SUI rate and perform the Wage Base change to $9,000 from $7,000. Assisted Payroll handled all remaining amounts due through our second quarter 2009 filing process. We calculated the amounts due for first and second quarter wage base increases, as well as the temporary additional fee of 0.6% increase that was currently due for the second quarter 2009 filing. A communication was sent to each customer to notify you of the additional tax amount that was debited from your account. Note: Your Service Representative will provide special instructions during this call to walk you through all changes in order to avoid any duplicate payroll debit(s).

	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)

	Washington
	Wage limit for state unemployment insurance (UI) and Employment Admin. Fund increased to $35,700 from $34,000. (20901)

	West Virginia
	Wage limit for state unemployment insurance (UI) increased to $12,000 from $8,000. (20916)
	Action Required: For more information on action required steps, click here. (20916)

	Wisconsin
	New withholding tables effective 1/1/2009.
	To accurately reflect the account number format for state withholding assigned by the agency, please verify the format is 036-9999999999-09. (20908)
	Action Required: If you need to modify the account number reflected in your company file, please take the following steps: Refer to Form WT-6. Enter the current Tax Account No. by selecting WI - Withholding from the Payroll Item List, click Next to get to the Agency for employee-paid liability screen. Enter the current Tax Account No. in the Enter the number that identifies you to agency box. Continue to click Next, and then click Finish. (20908)
	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.