The Payroll Report: April 16 to 20



Here is a roundup of payroll issues covered in the past week:


A sweeping Kentucky revenue bill (H.B. 366) retroactively eliminated the income tax brackets in favor of a flat rate while also providing for a threshold to decrease unemployment insurance rates.

The bill, enacted April 13 after the state legislature overrode a veto by Gov. Matt Bevin (R), sets the 2018 individual income tax rate at a flat 5 percent, eliminating the previous brackets of 2, 3, 4, 5, 5.8, and 6 percent.

The bill also provides that effective July 1, 2018, all unemployment insurance tax rates may be decreased by 0.075 percent if the balance of the state's trust fund exceeds the balance on Dec. 31, 2017. Kentucky's annual fund-reading date is Sept. 30.

A Nebraska bill (L.B. 1090) to update the state’s standard deduction and personal exemption in response to the new federal tax law (Pub. L. 115-97) was signed April 17 by Gov. Pete Ricketts (R), his office said.

The measure increases the standard deduction for tax year 2018 to either $6,750 or the federal value, whichever is lower, from $3,000 or the federal value. The state’s personal exemption credit, which was eliminated by the 2017 federal tax law, was restored to a value of $134 for 2018.

The New York budget for fiscal 2019 that includes an optional payroll tax was signed April 17 by Gov. Andrew Cuomo (D), his office said.

Employers are to elect to participate in the optional payroll tax by Dec. 1, 2018, and the tax is to be introduced at a rate of 1.5 percent on employee compensation of at least $40,000 a year in 2019.

Utah updated its withholding tables April 18, with the changes to take effect for pay periods starting May 1, 2018, and later. The new tables implement a bill (H.B. 293) signed March 26 by Gov. Gary Herbert (R) to decrease the state’s flat income tax rate to 4.95 percent from 5 percent, effective Jan. 1, 2018.

A Wisconsin bill (A.B. 748) signed April 16 by Gov. Scott Walker (R) prevents local regulation of employee hours and overtime, scheduling, employment benefits, and wage claims and collections.

Any existing local ordinances conflicting with the measure may not be enforced as of the bill’s April 18 effective date, but ordinances that limit the hours that a company may operate and that regulate overtime hours and overtime for traveling sales crew workers are not affected, the measure said.


A Redwood City, Calif., ordinance (No. 2443) to implement an hourly minimum wage in two increments was passed April 9 by the city council and signed April 10 by Mayor Ian Bain. The measure is to take effect May 10.

The local minimum wage on Jan. 1, 2019, is to become $13.50 an hour. The minimum wage is to rise to $15 on Jan. 1, 2020, plus an inflation-related adjustment to be determined in August.

By Jamie Rathjen

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