Daniel L. Morgan
Since January 1, 2018, the date changes to the tax law passed by Congress at the end of December (the “Tax Act”) became effective and provided new individual marginal tax rates and modified deductions, the Internal Revenue Service (“IRS”) has been scrambling to provide guidance as to how those changes are to be taken into account for income withholding tax purposes.
Yesterday, February 28, 2018, the IRS introduced an online calculator to help employees determine the correct amount of income taxes that they should have withheld from their 2018 wages. The IRS has also issued a new Form W-4, Employee’s Withholding Allowance Certificate. Continue reading “Employers Should Encourage Their Employees to Revisit Their Tax Withholding Elections in Light of the New Tax Law”
Andrew J. Rudolph
The Tax Cuts and Jobs Act (the “Act”), which has been approved by the Senate and the House of Representatives, includes a provision that eliminates the “performance-based” exception to the $1 million limit on compensation deductions, and makes certain other important related changes. Under current law, compensation deductions for a publicly-traded employer for its top executives (other than the Chief Financial Officer) is limited to $1 million, plus compensation that qualifies as performance-based. Qualified performance-based pay generally includes stock options and stock appreciation rights, and restricted stock, restricted stock units, and cash incentive bonuses conditioned on the satisfaction of pre-established quantitative performance conditions approved in advance. Continue reading “Public Company Alert: New Tax Law Re-Writes the Rules under Tax Code Section 162(m)”
Daniel L. Morgan
The Tax Cuts and Jobs Act (the “Act”), which was agreed upon by the House/Senate Conference Committee last week, includes a provision that imposes an excise tax equal to the corporate tax rate—which is 21 percent under the Act—on certain compensation paid to employees of tax-exempt entities, including not only 501(c)(3) organizations, but also 501(c)(4) and 501(c)(6) organizations, as well as governmental employers and political organizations.
Under the Act, an employer subject to the new rules would be required to pay the excise tax with respect to compensation paid to any of its five most highly compensated employees (referred to under the Act as “Covered Employees”) in two separate instances. Continue reading “Congress’ New Tax Law—Excise Tax Coming on Compensation of Tax-Exempt Organization Executives”
Anthony A. Mingione
Earlier this year, New York City amended its Human Rights Law to make it unlawful for an employer to ask about or rely on a prospective employee’s prior salary history in making hiring decisions. The amendment bans both direct inquiries from applicants and attempts at learning applicants’ previous salaries from indirect sources, such as independent research or third party conversations.
The legislation becomes effective on October 31, 2017, so New York City employers should take advantage of the remaining time before the effective date to conform their hiring practices to the new restrictions. Continue reading “Trick or Treat? New York City Salary History Ban Becomes Effective October 31”