APA Lobbying APA’s Mission - StarChapter · APA Lobbying Efforts Representing payroll professionals before federal, state, and local governments. APA’s Mission Educating government

APA LobbyingEfforts

Representing payroll professionals before federal,state, and local governments.

APA’s Mission

Educating government andcommunity decision-makersabout the payroll industry.

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● Minimizing the burden on payroll

● Ensuring consistent and equitable requirements

● Promoting understandable forms and instructions

● Pushing for uniformity in wage garnishments

● Providing opportunities for open discussion

APA’s Goals

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● Child Support and Other Garnishments

● Immigration (Employment Verification)

● IRS Issues

● Payroll Cards

● Retirement Accounts

● State and Local Taxes

Government Relations Task Force

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Retirement Accounts

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Retirement StatisticsState Access Participation

Nationally 58% 49%

Wisconsin (Highest) 70% 61%

Florida (Lowest) 46% 38%

California 51% 44%

Georgia 53% 45%

Pennsylvania 65% 56%

Texas 50% 42%

Virginia 63% 55%

The Pew Charitable Trusts

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● 42% saved less than $10,000

● 14% saved nothing

● ~13% saved $50,000 to $99,999

● ~16% saved $300,000 or more

GoBankingRates Surveys

Retirement Statistics

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Not enough income

Priority to pay down debt

Struggling to pay current bills

Used money for an emergency

Employer does not offer plan

Retirement Behavior

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● Treasury Department’s myRA Program

◦ No employer mandate

◦ Low participation

◦ Financial company opposition

◦ Republican opposition

● Treasury Department’s myRA Program

◦ No employer mandate

◦ Low participation

◦ Financial company opposition

◦ Republican opposition

Federal Government Interest

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● Labor Department’s Safe Harbor Rules

● Congressional Review Act

◦ H.J. Res. 66 (States)

◦ H.J. Res. 67 (Subdivisions)

Federal Government Interest

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● H.R. 4523, Automatic Retirement Plan Act

● H.R. 3499, Automatic IRA Act

● H.R. 4997, Give Retirement Options to Workers Act

Federal Proposed Legislation

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● Budgets

● Republican and Democrat

State Interest

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State Retirement Laws

Mandatory Laws

Study Laws

Mandatory Proposed

Marketplace Laws

Limited Mandatory Laws

Study Law Proposed

Past Proposed Laws

OR

WA

CA

MT

NV

ID

UT CO

AZ NM

AK

HI

TX

OK

KS

WY

ND

SD

NE

MO

IA

MNWI

IL

MI

IN

KY

ARTN

LAMS AL GA

FL

SC

NC

VAWVOH

PA

MD

DENJ

NY

MEVT

NH

CTMARI

Voluntary Laws

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State Approaches

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● Neither support nor oppose

● Engage as subject matter expert

● Offer recommendations on proposals

● Employer communications report

APA’s Position

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● Definition of employer

● Definition of employee

● Recordkeeping and reporting

Payroll Concerns

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Labor Issues

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● Notice of Proposed Rulemaking

◦ Sharing of tips

◦ Workers who do not customarily receive tips

◦ Employers that pay direct cash wages of at least the federalminimum wage

Federal Tip Pooling

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● Consolidated Appropriations Act (P.L. 115-141)

◦ Signed March 23, 2018

◦ Sharing of tips by workers who do not customarily receive tips

◦ Prohibits employers, managers, and supervisors from collectingand retaining tips

Federal Tip Pooling

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● Current: $23,660/year, $455/week

● DOL May 2016: $47,476/year,$913/week

● Lawsuits:◦ August 2017, DOL exceeded authority

◦ Appeal Oct, Nov 2017 – on hold

Federal Overtime Rules

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● DOL Rulemaking Process

◦ Request for Information (July 2017)

◦ Assessing public information

◦ October 2018 new rulemaking expected

Federal Overtime Rules

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● Nationwide pilot program

● Overtime and minimum wage violations

● Resolution without litigation

● Improve compliance

● Pay back wages faster

Payroll Audit Independent Determination

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● Washington S.B. 6264-2017-18

● Blocking institutions of higherlearning from outsourcing

● APA opposition letter

● Amendment carves out payroll

Outsourcing Payroll Services

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Wage Garnishments

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● IRS Pilot Program

◦ Electronic capabilities

◦ Facsimile transactions

● Role of APA

Federal Tax Levies

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● Commission on Consumer Bankruptcy

● Review of bankruptcy laws and regulations

● Chapter 13 Wage Earner Plans

● Role of APA

American Bankruptcy Institute

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Uniform Law Commission

“The Uniform Law Commission provides states withnon-partisan, well conceived, and well draftedlegislation that brings clarity and stability to criticalareas of state statutory law.”

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● Garnishing wages in bank accounts

◦ Study group

◦ Garnishment limits

◦ Potential double garnishment

◦ Role of APA

ULC and Bank Accounts

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● Drafting process

● APA’s participation

Uniform Wage Garnishment Act

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● Provisions

◦ Limited role of courts

◦ Definition of employee

◦ Principal place of employment


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● Provisions

◦ Service of order

◦ Notice to employees

◦ Administrative fees


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• Competing and limited resources• Creditor opposition

UWGA Implementation

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● Nebraska

◦ L.B. 37, adopting the UWGA

◦ L.B. 978, harmonizing garnishment provisions

State Creditor Wage Garnishments

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● Wisconsin

◦ S.B. 397 / A.B. 476

◦ Eliminating 13-week limit


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● Colorado

◦ H.B. 18-1057

◦ Asset Recovery Efficiency Act

◦ Disclosure of debtor information


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● Mandatory electronic responses in civil cases

● Problems for payroll management

● Role of APA

● Court’s response

Illinois Supreme Court

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Child Support

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● Defining the problem

◦ Consumer Credit Protection Act

◦ Definition of earnings

◦ Garnishment limits

◦ Burden on payroll

Lump-Sum Payments

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DOL Fact Sheet #30:

“Earnings may include payments

received in lump sum.”

Lump-Sum Payments

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● DOL opinion letter to APA

● 3 pronged determination:

◦ Lump-sum payments fully covered

◦ Lump-sum payments partially covered

◦ Lump-sum payments not covered

Lump-Sum Payments

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● Illinois’ revised withholding limits

● Colorado’s calculation method

Income Withholding Issues

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Colorado Overpayments

Income Withholding Issues

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● Mandatory requirements

◦ 16 states and territories

◦ Washington H.B. 2188

◦ APA’s position

Electronic Child Support Payments

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● Defining the problem

● The Work Number

● Michigan’s April 2018 letter toemployers

Verification of Employment

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Federal Taxes

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● Increases standarddeduction:◦ $6,350 to $12,000 single

◦ $12,700 to $24,000 married

● Eliminates personalexemptions:◦ $4,150 to $0

TCJA Basic Information

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● Raises child tax credit:◦ $1,000 to $2,000 per child

◦ Phase out‒ $110,000 to $400,00 joint filers

‒ $75,000 to $200.000 all other taxpayers

● Non-child tax credit-eligible dependents:◦ $500 credit


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● Limits state and local tax deduction to$10,000

● No mortgage interest deduction on debt over$750,000


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● Exclusions still in place:◦ Adoption assistance programs

◦ Dependent care assistance programs

◦ Tuition assistance plans

◦ Employee achievement awards

◦ Limits on employer-provided housing and meals

Employer-Provided Assistance

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● Exclusions eliminated:◦ Bicycle commuting reimbursements

◦ Employer-paid moving expenses (except military)

Employer-Provided Assistance

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● Changes to benefits:◦ Elimination of deduction for

qualified transportation fringebenefits

◦ Limitation on deduction for foodand beverage expenses that arede minimis fringe benefits

Employer-Side Benefits

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Family and Medical Leave Credit• For qualified employees – 25%

• Conditions:◦ Pay 50% of regular wages or only 12.5% credit◦ Increases as % of pay during leave increases◦ 2 weeks of leave for full-time employees

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● Definition of qualified employee◦ Worked 12 months for employer

◦ Preceding-year annual compensation = 60% highlycompensated employee threshold ($120,000 2018)

● Ends December 31, 2019

Family and Medical Leave Credit

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• 140 integrated software systemsat IRS

• 465 forms and guidancedocuments

• Tax administration and funding

• Tax Reform ImplementationOffice (TRIO)

IRS Implementation

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● Withholding tables

◦ Deadline – February 15, 2018

◦ Supplemental wages – 22%

Tax Withholding Tables

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● Released February 28, 2018

● Which employees:◦ 2-income families

◦ 2 or more jobs

◦ With itemized deductions

◦ High income and complex tax returns

Form W-4

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● Role of APA in 2018◦ Desire for quick turn-around

◦ Refigure formula for child credits

◦ Configure non-child dependents as allowances

● Early 2019 draft for review?

Form W-4

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● Encourage taxpayers toreview their withholding

● APA’s efforts:◦ Worked with IRS on

messaging

◦ Offered recommendations onthe withholding calculator

Paycheck Check-Up Campaign

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● Health Savings Accounts◦ Individuals with a family high-deductible health plan

◦ Reduced from $6,900 to $6,850 ($50 difference)

● APA request for relief

● April 26 IRS grants relief withinstructions

Transition Relief

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• H.R. 5444, Consolidated proposed legislation◦ Modifies titles of several IRS officials◦ Eliminates IRS Oversight Board◦ Requires IRS to submit a reorganization plan◦ Requires IRS to submit customer service strategy

IRS Tax Administration

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● H.R. 5444, Consolidated proposed legislation◦ Creates independent Office of Appeals

◦ Revises enforcement procedures:‒ Referrals to private debt collectors

‒ Contacting third parties


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● APA recommendations:◦ Agency-wide technology plan

◦ Lower threshold for electronic filing

◦ One point of contact – identity theft victims

◦ Internet platform for Forms 1099


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● APA recommendations:◦ Uniform standard for electronic signatures

◦ Enhance online accounts and portals

◦ FundingBudget: IRS requested $397m, received $320m


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State Taxes and Impacts of theTax Cuts and Jobs Act

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STATE INDIVIDUAL INCOME TAX STARTING POINTSFederal Taxable Income

Colorado Minnesota North Dakota South Carolina Vermont

Federal Adjusted Gross Income

Arizona California Connecticut Delaware Washington, DC Georgia

Hawaii Idaho Illinois Indiana Iowa Kansas

Kentucky Louisiana Maine Maryland Michigan Missouri

Montana Nebraska New Mexico New York North Carolina Ohio

Oklahoma Oregon Rhode Island Utah Virginia West Virginia

Wisconsin

State Definition of Income

Alabama Arkansas Massachusetts Mississippi New Jersey Pennsylvania

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STATE LINKS TO THE FEDERAL TAX CODE

Static or Fixed Date

Arizona California Georgia Hawaii Idaho Indiana

Iowa Kentucky Maine Minnesota North Carolina Ohio

Oregon South Carolina Vermont Virginia West Virginia Wisconsin

Rolling or Current Date

Colorado Connecticut Delaware Washington, DC Illinois Kansas

Louisiana Maryland Michigan Missouri Montana Nebraska

New Mexico New York North Dakota Oklahoma Rhode Island Utah

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● Concerns for states:◦ Ensuring state revenue with reasonable assessments

◦ Ties to federal income taxes

◦ State and local income/property tax limit of $10,000

◦ Personal exemptions

State Taxes

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● Tax studies

● Myriad of ideas

● APA’s State and LocalTaxes Subcommittee

State Tax Action

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Mobile Workforce Legislation

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● Inconsistent state requirements

◦ Nonresident state, temporary work

◦ Withholding versus filing requirements

● Poor compliance

● High administrative costs

Nonresident Income Taxes

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AK

HI

OH

CAVA

MI

GA

KS

IA PA

WV

MS

ORSD

MO

WI

MN

KY

SC

FL

NC

UT

AZ

ND

NM OK

TN

NE

WY

LA

IL IN

AR

NY

CO

AL

MT

ID

NV

TX

MEWA

NH

VT

MA

RI

CT

NJ

DE

MD

DC

Nonresident employees subject to tax withholding on first day of travelNonresident employees subject to withholding after reaching thresholdNo general personal income tax (or, in the case of DC, no tax on nonresidents)

Nonresident Income Taxes

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MobileWorkforceCoalition.Org

Protecting America’s

traveling workforce!

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● Abercrombie & Fitch

● Apple

● Bayer Corp.

● Best Buy

● Campbell Soup

● Coca-Cola Corp.

● Del Monte Foods

● Domino’s Pizza

● E&J Gallo Winery

● Expedia

● Fidelity Investments

● Feld Entertainment

● General Electric

● General Mills

● Home Depot

● HCR ManorCare

● Intel Corp

● IBM

● Johnson & Johnson

● JC Penny

● Kelly Services

● Kimberly-Clark

● Lockheed Martin

● Lowe’s Companies

Coalition Members• Macy’s• Microsoft• McLane Company• National Grid• Neiman Marcus• Opnext• PepsiCo Inc.• Progressive Ins.• Qualcomm• QVC, Inc.• Raytheon Company• Rolls Royce

• Sprint• State Farm• TD Ameritrade• True Blue• Unisys• UnitedHealth Group• Vanguard Group• Verizon• Walmart Stores, Inc.• Wells Fargo• World at Work• Xerox

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● Mobile Workforce State Income TaxSimplification Act◦ 30 day safe harbor

◦ Retroactive to day one

◦ Preserves reciprocity agreements

◦ Exceptions: athletes, public figures,production employees

Mobile Workforce Bill

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● Write a letter to your U.S. senators

● www.mobileworkforcecoalition.org/contact-congress/#/

● Click on the “Take Action” button

● Follow instructions

● Click “Send”

Mobile Workforce Bill – Your Help

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Documents

APA Lobbying APA’s Mission - StarChapter · APA Lobbying Efforts Representing payroll professionals before federal, state, and local governments. APA’s Mission Educating government