Regulatory Roundup July 2021

The dog days of summer brought sweltering heat to much of the country along with multiple changes to state-based legislation. While many of these changes revolved around tax withholding tables, the Internal Revenue Service (IRS) also released a new set of COBRA Subsidy FAQs, and the state of New Hampshire adopted a new Paid Family Leave Plan. Learn about these changes and other updates below.

New Hampshire Governor Chris Sununu recently signed into law a budget bill that included the new Granite State Paid Family Leave Plan. Taking effect January 1, 2023, this voluntary plan grants tax credits to employers who opt-in to provide employees greater employment protections during leave, such as continuation of health insurance coverage, and protection from discrimination and retaliation due to taking said leave. Employees qualify for the leave due to certain life events, such as the birth of a new child, caring for a spouse who is in the military, and adopting or fostering a new child.

On July 26, 2021 the IRS released a second round of FAQs for the COBRA premium assistance provisions in the American Rescue Plan Act (ARP). Notice 2021-46 has 11 new question-and-answer pairs related to multiple topics, including availability of the subsidy for those who are eligible for an extension, but did not elect to use it.

The states of New York, Idaho, and Kansas all revised tax withholding tables for their citizens:

• New York and its city Yonkers revised their withholding table due to the state budget signed on April 19, 2021. Employers with employees earning certain amounts over $1,000,000 dollars will need to update their withholding calculations for payrolls made on or after July 1, 2021.
• Idaho’s State Tax Commission (STC) released a revised table as well, but while the STC applied the new rates retroactively to January 1, 2021, employers are not required to adjust past withholdings. Employers should, however, adopt the new rates for all payrolls moving forward.
• The Kansas Department of Revenue (DOR) announced amendments to its withholding tables had been signed into law on July 13, 2021. The amendments also increased the standard deductions for single filers, married filers, and head of household filers.

Finally, on July 23, 2021 the Massachusetts Department of Unemployment Assistance (DUA) accidentally mailed an incorrect communication to some employers titled, “Notice of Uniform Secondary Adjustment Assessment.” These employers should soon receive the correct communication titled, “DUA Rate Adjustments Completed.” Those who received the erroneous communication, or those with questions about the mailing, should contact the DUA directly.

Get more details on the compliance updates from July here:

New Legislation

• New Hampshire Paid Family Leave

Existing Legislation Updates and Corrections

• IRS Releases 2nd Set of COBRA Subsidy FAQs
• NY State & Yonkers 2021 Withholding Tables Revision
• Idaho State Tax Commission (STC) Withholding Tables & Annual Tax Credit Update
• Kansas Department of Revenue Withholding Table Update
• Massachusetts DUA sends Notice of Assessment Adjustment in Error

Visit our Return to Work page to browse our resources to help you engage, rehire, and recruit in this new environment. You can also check out our Legislative Updates Related to Coronavirus (COVID-19) for a comprehensive summary of legislative changes and how Paylocity has responded with updates to our product to help you stay compliant. For the latest information and resources related to the coronavirus, check our COVID-19 Resources page often.

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This information is provided as a courtesy, may change, and is not intended as legal or tax guidance. Employers with questions or concerns outside the scope of a Payroll Service Provider are encouraged to seek the advice of a qualified CPA, Tax Attorney, or Advisor.