Additional Medicare Tax goes into effect January 1, 2013 at .09 percent for individuals with wages, other compensation and self-employed income that exceed the threshold amount. The IRS has provided a questions and answers page for business owners and the self-employed to assist them with preparations for the implementation of this tax. For the complete details, follow the link to the the IRS website.
Business owners using software to prepare their payroll need to be sure to download the vendor software payroll tax updates prior to processing their first payroll in 2013 to insure the payroll taxes are properly calculated. Confirm your software payroll tax subscription is current before January 2013 to be eligible to download the tax updates. Most software payroll tax subscriptions require an annual subscription renewal.
Now is the time to review your software payroll subscription to prepare in advance for this cost. Contact your software vendor for details. Need help? You know where to find me!