Medlin Software, Dennis

My update was posted a couple of minutes ago... Not my first rodeo Other than testing the actual accuracy of my calculation against n1036, I did a test of a married 0, 1k week. 24 less FWH. I was actually guessing today. They post the file, if you know where to look, the day "before" the list of their current files gets updated. Something like this, they seem to prefer Friday for wide knowledge, and with the Monday holiday, even better for them Anyone that wants to play, can download and install our free trial and see the results.

Notice 1036 was (likely) posted today, Reviewing it now... https://www.irs.gov/pub/irs-pdf/n1036.pdf

Poop happens often. My point was to encourage practical security steps, tor realize nothing is secure once our of your head, and to prepare for and actually regularly practice recovery. For email, I assume the world may read it, and write/send with that in mind. Practical data security is easy. Setting up for recovery is easy. Actually testing recovery is easy, but rarely done. The odds are every person with some sort of paper or electronic trail has been compromised already, with no lasting harm (some small percentage have a short term hassle, if not adequately prepared), if even aware of the situation at all. A few have long term hassle, such as having to get a new SSN (something we have experienced in our family). I gave up on a list of passwords many years ago. I do not reuse or recycle them, and I have a memorized way to create unique passwords as needed, including symbols not directly on a keyboard. I have an odd perspective for certain since I hear from folks on a daily basis, who are needing to recover, and were not prepared at all, or worse yet, thought they were prepared and actually were not.

I don't want to guess what sort of calculation the IRS will publish (see my worry below). The "problems" which may be avoided by not requiring a new W4 are no collateral damage to states which allow the use of the federal W4 information and/or do not have their own W4 form, and there is no way in you know what every employer wants every employee to have to submit a new W4. Many employees would not supply a new valid form in a timely manner, requiring the employer to use single (max withholding), which will cause nasty push back from the employee to the employer, when their net pay goes DOWN after listening to the talking heads saying their net pay would go UP. I could see the old "allowances" still having some affect, as there is a possible child credit. I worry the calculations will be structured for political benefit, to have the most see a net pay increase (such as "assuming" allowances are children triggering the child credit). I have already begun getting that type of question (from employee/owners, and from employers incorrectly seeking advice to give their employees). My reply is to contact their tax advisor for assistance with ensuring their withholding meets their personal desires, once the new calculations are available, and after a few weeks to let the tax folks suss out the results.

(After regaining my composure after considering logic and/or thinking in politics.) Some source probably pointed out what a W4 change would entail, not only on employers, but on all the states without a separate W4, or with calculations based on the federal calculations and W4, so the wonks were somehow allowed to design calculations using the current W4. There will still be state WH ramifications, which may last several months after the IRS publishes n1036. In the past, when only the bracketology changed, the wonks had calculations published as soon as the bill was signed (if not at 12:01am the day the bill was scheduled to be signed). This time, it is likely taking longer because of running more test scenarios than usual, and since the politicians have all said we would see the change starting as soon as February. I doubt it took longer than a day to design the new calculations.

The 2018 federal WH calculations will be not require a new W4.

I can see where you might think so, but you are mistaken. I take what any expert would consider realistic steps. The basic step is to use my grey matter at all times, before firing off signals to my fingers. I also keep nothing online which is embarrassing to lose. For the average person (a non keeper of valuable mass data), data recovery is the bigger threat.

Nice to read (now un) common sense once in a while. There is no such thing as privacy or security. Anything can be found or accessed, given the needed tools and time. Normal actions, such as locking a door, and trying not to lose your data will keep the casual out. Criminals will always find a way, so insurance and recovery ability is where I put my "worry" time. With that said, as Lion said, we still have to comply with the laws those we elect burden us with, in their attempts to get reelected protect us from ourselves. I have not looked in some time, but there was one tax jurisdiction which had a law essentially preventing anyone from storing employee data online, as it has to be always under the employer's control. I do use encryption and passwords, but only for overall access, and when doing certain things online. Long passwords can make password hacking reasonably hard, and encryption makes internet sniffing a bit tougher.

Personally, I would not worry about what any other person or service calculated. What matters is what you prepare needs to be accurate. (If you are entering last year's after the fact, then no calculation matters, you are stuck entering whatever was done, correct or not.) FWH for 2018, so far, is the same calculation as 2017. Same for MO, since MO is waiting for FWH to be published before publishing theirs. You do not have to interpret any employee intent on their MO W4 type form, you just have to take the employee's information, and use it. The form and calculations work together. http://dor.mo.gov/forms/Withholding Formula_2017.pdf P.S. Most tax agencies also allow an employer to use their own calculation/formula, as long as it calculates with a certain range of the published methods. FWH, for instance, allows a WIDE latitude. CT, as another example, states there is no formula or calculation possible (has to be done through charts and steps), but every payroll software provider has likely done what I did many years ago, and built a formula which exactly matches the charts/steps...

I bet that is the hardest part of your job, being the first line of sanity (client's desire versus allowable). It is the toughest part of mine! I was asked, more than a dozen times today, how to do something which is not allowed... and of course, I am a donkey for not allowing it.

(now UN)Common sense rarely prevails... Interesting how a broker can require an agent to work mandatory floor time, in person, during designated hours, and not be an employee (at least for those hours), and the broker has operational control and shares profit with their employees agents.

"too stupid to have that feature." Wow, candid answer at its worst. As a programmer, who also does support, rule 1 is the end user will do something they are not supposed to do. Rule 2, is you will spend the bulk of your time in a vain attempt to prevent rule 1. I answer that inquiry, if this is the proper case, with something along the lines of "the tax agency requires the full SSN on that particular form, we are not allowed to truncate or mask". When pressed, I will mention many tax forms contain a vendor code, and if submitted, and the vendor did not comply with the requirements, not only will the TP get fine, so will the vendor, and the vendor can have all their forms refused if it causes a large number of manual handling by the tax agency. In real use, I am certain things get masked by "printing" to a PDF, then editing before printing to paper, or by making a copy with a sticky note over the items to be masked.

Maybe the handlers (do the handlers change, or is the same small group really in control of politics? Maybe I do not really want to know...) of those we elect are wising up too, and trying a new sales pitch... It would be fun if they had to drink what they sell (think VitaMeataVegamin).

There are other states with no separate W4, or allow the federal W$ to work for both. Could be part of the reason the IRS decided to create calculations not requiring a W4 change. For many years, we have suggested having a separate W4 type form for federal and state, even if not required. Much easier for the employer in the long run. There are states which allow a deduction for federal tax withheld. It will be interesting to see if any change their calculations, or just take the windfall.

My prediction of almost instant notice 1036 failed... My guess is reworking to not need a new W4 is the delay. ANYTHING which makes an employee net pay less than expected will cause push back to the employer. Since the "news" keeps mentioning how employees will see more net pay, suggestions to employers such as posting a copy of the IRS notice may save the employer some time, as well as lost productivity. Personally, I would only post the IRS statements, verbatim, with no comments added by the employer (which is what I am suggesting to my customers). Also check for statements from the state, in case the state (such as ND) is tied to FWH calculations.

I bet within a day (working day) of the signature, the IRS will release new withholding calculations, like happened at least one other time the rules were changed late in the year. The IRS already likely has people, if not directly ordered, wisely reviewing and preparing, just like some here choose to do. For the common folk, the withholding changes are what they wait for (and what the President keeps touting - paycheck changes). The rest can be worked through. Those that have means to shuffle income and expenses, are wisely looking at what will likely pass, and will have a signature (or not) by the end of the week. That leaves a few working days to shuffle. There was, today I believe, a procedural fix, which was likely the last Dem grasp at straws for their next campaign literature. I have seen nothing about any possible last minute issue. Also, the ability of McCain to go home, rather than stay, likely tells the outcome will not require his vote, or the VP vote. But, anything can happen, even just before signing, or just after, so every day is a new adventure. The interesting part is the daily questions I get asking why "I" do not already know the 2018 withholding calculations.

"it is impossible to pay the tax on New Years Day since it is a legal holiday." A check can be used, with a check date of 1/1. Or if online, payment can be done (or maybe scheduled for) 1/1. For the possible rule change, for this one, I look at the intent - what the politicians likely intended. The intent seems to be to keep people who have the means to, from prepaying to squeeze in more deductions before the new limit kicks in. I have faint memory of a talking head pointing out this item was revenue positive, on purpose, to "pay" for cuts elsewhere.

As usual, a gift of continued full employment for those who have to manage what those we elect regurgitate.

Abby, I get it. I have been dealing with this for years. I know the rule only applies to the W2, and the instructions for 941 allow them not to match (I always remain open to being proven wrong). So instead of defending the rules, I also allow those who insist to alter their 941 if they wish to, in spite of not one person has ever shown me, nor have I ever found, any direction from the IRS do do so. My point is since there is no direction requiring altering the 941, doing so is actually wrong, although clearly what many prefer to do, believing having matching 941/W2 figures is required, or more important, than not adding figures when it is not required. Since there is no direction requiring it to be added to a 941, no one knows when to add it, every Q, as paid or as earned, or as a lump amount on one Q form... In my case, those who are insistent, are asking for some way to make the 941/W2's match, and since the question is never asked until Q4, we allow them to alter their Q4 941. It is one of those things which has "come to life", just like the annoying receipt of 1099's by those who were not required to receive them, because it is easier for the sender to blindly send to all, versus figuring out if the recipient is subject to 1099 reporting, or was even paid beyond the threshold. I have to personally deal with the unneeded 1099's myself. If I was worried that the IRS receiving an unneeded 1099 was an issue, I would go crazy! It is for a substantial amount my wife is paid, for remaining home to care for our disabled daughter. By law, it is not taxable income, and she had to sign a notice to the entity paying, that it was not taxable, but still comes the 1099. It makes my wife nervous every year, but the IRS has yet to come calling. Same for a state which recently asked for something to be done on a W2. It was a request, impossible to do (a long description, in a short space, in a large font). Some took this "request" as a requirement. In that case, I had to stick to the rules, and explain why, since meeting the request is physically not possible, given the space on the W2. The request had NOTHING to do with tax collection or reporting, it was merely a misguided way to try to get taxpayers to not complain to the tax agency, when they cannot read the small writing required to fit what the tax agency wants to fit in the little box! -- "If the amounts don't agree, you may be contacted by the IRS or the Social Security Administration (SSA)." (Does not say they must or are required to agree) "When there are discrepancies between Forms 941 or Form 944 filed with the IRS and Forms W-2 and W-3 filed with the SSA, the IRS must contact you to resolve the discrepancies." (Still does not say they must agree) Here is the "winner": "Amounts reported on Forms W-2, W-3, and Forms 941 or Form 944 may not match for valid reasons. For example, if you withheld any Additional Medicare Tax from your employee’s wages, the amount of Medicare tax that is reported on Forms 941, line 5c, or Form 944, line 4c, won’t be twice the amount of the Medicare tax withheld that is reported in box 6 of Form W-3. If they don't match, you should determine the reasons they’re valid. Keep your reconciliation so you’ll have a record of why amounts didn't match in case there are inquiries from the IRS or the SSA."

No one knows, until it is official. Skimming one version (479 pages) for grins, there is at least one item pertaining to 2015...

The only regulation for reporting the 2% shareholder insurance has to do with W2 reporting. Some claim it must also be on a 940 and 941, but I have never seen such official instruction. rfassett agrees with me, and the 941 instructions - the instructions say the 941's and W2 should match, but they do not have to. The one caveat is one should keep notes as to why they do not match.

I advise my customers NEVER to give tax advice to their employees (even if they are in the tax prep business, and the employee would want to be their client, I would still say stay clear of becoming their employee's tax expert). Given what has been published, not changing a W4 might lead to federal over withholding rather than under (less exempt wages and less tax rate). Certain states are more of a worry, depending on how they incorporated the federal calculations into their own. Of course, the personal situation (itemize or not for instance) alters this greatly.

As frustrated as I am, frustration = lifetime income potential... Personally, what to do in the next few weeks is clear, and fortunately, easy. I do not have others relying on my advice for pay... For my customers, the daily issue is WHEN will the politicians make their decisions, so they can stop worrying about what to do for their first payroll for 2018. I did see the first (at least in the news feeds I read) mention of the federal "changes" causing problems for a number of states. I warned my customers of this already...

Awesome, and I bet you could paste my photo there at any life stage... A couple look like my kidney stone dance, one could be my face when drinking yet another cup of water (to prevent #1), and the last, I don't always have to put on shoes, so I get out of practice It is actually a real issue, as I am so used to being barefoot, I can catch a shoe on the stairs since the shoe is longer than my bare foot. Have to remember to use the railing and go slower.