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What to Look For in Your Human Resources Business Solution

Human Resources continues to be one of the most essential departments in the business world. Without it, your employees wouldn’t have access to the proper tools they need to stay successful.

This is why your HR department needs smart business solutions to keep the workforce thriving. With the right technologies, your HR can help prevent turnover and create more engagement among employees.

However, if you feel like your HR team has slipped behind technologically, take a look at some key things to look for as major solutions.

Verification of Employment Solution

One essential task HR takes on is verification of employment. This also usually involves income requests, requiring considerable organization based on the complex data involved. You need top-tier tech solutions to organize it all, plus keep all that sensitive information safe.

Many companies outsource this task to third-party companies. Not all companies do a good job, especially if not more focused on comprehensive HR technology.

Your best solution is going through VeriSafeJobs, offered through Quentelle, and bringing more superior reporting capability to your operations. The use of VeriSafeJobs lets you enjoy advanced metrics, so all employment verifications are thorough. A smart and simple user experience also helps with learning curves.

It’s also worth noting that VeriSafeJobs has unmatched client support, so your HR team gets questions answered fast. Privacy is taken seriously with FCRA compliance.

Simplify Unemployment Claims

Your HR group already knows the complexity of dealing with unemployment claims through your employees. The process was once very protracted, leading to possibly exhausted HR workers keeping up the pace. Most of this resulted from adhering to filing deadlines, creating issues when sending claims by regular mail.

Now you can simplify it by using ValeU NSN, a partnering company with Quentelle. This works by digitizing the entire unemployment claims process. Your company should be able to send these claims electronically, so you never miss deadlines.

The result of this is getting a week’s head-start on claims, so they’re filed sooner. Response times are ultimately faster as a result.

ValeU NSN is made for Fortune 100 companies, though any-sized company finds benefits using this solution. Implementation should also be simplified when you work with the right consultant.

Reduce Unemployment Tax Complications

Your HR department probably wouldn’t argue that dealing with unemployment taxes is one of the most complex tasks they’ve ever done. A considerable burden here is the overly complicated tax rules in each state, usually creating inaccurate data.

Our partnership with ValeU Group provides more accurate figures, so you never have to worry about tax penalties again. The benefit here is Vale U Group has more extensive knowledge of state tax rates, hence having a real unemployment tax expert in your corner.

Expect them to hunt vigorously for errors and provide the most accurate reports. These are real state tax experts who work as outsourced advisors.

Working with them, you’re guaranteed accurate unemployment tax information. Plus, you gain a dependable consultancy team on all other tax matters.

Simplify Your WOTC Program

Taking advantage of tax credits is no doubt a vital part of your business. A WOTC program is beneficial not only for you but to those you hire who have barriers to employment.

Otherwise known as Point-of-Hire tax credits, getting WOTC set up can take a lot of time for your HR team. Much of this is the pre-screening process, not including waiting to sign the 8850 form.

Our partnership with Walton gives you access to quality tax credit experts who can save you more than if letting HR handle it. Walton simplifies the process by sending digital questionnaires your employees fill out. Based on their answers, Walton finds ways to bring double the savings possibly. 

Now you can speed up the eligibility pre-screening, plus get help with other tax credits you overlooked. Read about how our partnership with Walton saved a national grocery chain double the amount from what they initially thought.

Improve Your HR Analytics

Your HR staff likely already use analytics of some sort, but how detailed are they? Not all analytic programs are great at providing the granular information HR employees need to help other company employees. When HR doesn’t see the whole picture of what’s going on, it only frustrates those they’re trying to help.

Our HR analytics engine keeps your HR workers in the know. It all starts with tapping into big data and organizing it in the most efficient ways. You can expect to bring more optimal employee performance using a better approach to big data.

Improving this further focuses on utilizing artificial intelligence to compile all the large amounts of data coming in. AI has truly advanced tenfold from just a few years ago. Now it can help organize metrics in a truly more intelligent way. Best of all, AI scopes out business trends you probably can’t see without more help.

Rounding this out is our metrics platform is fully integrated into the HR solutions suite. This enables your HR team to access all data from one source rather than from disparate data silos. Accessing information all in one place makes for more productive HR workers rather than add to their stress.

Bring a Digital Transformation to Your HR Department

Based on the above tools, you can see that a digital transformation must keep up with business challenges in today’s times. HR duties are far more complex today than a decade ago. 

Finding the right technology is the biggest hurdle. Another challenge is finding tools that integrate, so HR workers don’t have to search from multiple sources to answer critical questions.

We take technology seriously at Quentelle, where our sophisticated big data program is now renowned worldwide. Through that, we’ve incorporated AI and other emerging technologies to help advance companies to new plateaus.

Customizing is also at the center of our mission since every company’s HR department is different.

Contact us to learn more about how we can improve your HR team’s work by scheduling a demo.

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News Update: Recent Changes to Point-of-Hire Tax Credits

On Wednesday, April 21, 2021, President Joe Biden announced a refundable tax credit available for select businesses that pay employees that need to take time off to get vaccinated for COVID-19.  This is part of the administration’s effort to involve employers to promote vaccination.

“Today we hit 200 million shots,” Biden said. “It’s an incredible achievement for the nation. I’m calling on every employer, large and small, in every state to give employees the time off they need with pay to get vaccinated,” said the President.

Here’s what we know about it so far:

  • The tax credit will apply to businesses with fewer than 500 employees
  • The tax credit amount equals up to two weeks (80 hours), limited up to $511 per day for each employee, and $5,110 in the aggregate at 100% of the employee’s pay rate
  • The tax credit is available between April 1 and September 30, 2021. 
  • Tax credit is refundable, meaning the employer is entitled to payment of the full amount of the credit if the tax credit amount exceeds the employer’s share of the Medicare tax
  • Employers can claim the credit on using IRS Form 941 – Employer’s Quarterly Federal Tax Return

This tax credit was authorized under The American Rescue Plan Acct of 2021 (ARP) which was signed into law on March 11, 2021.

 

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A Brief Guide to State Unemployment Taxes

Sifting through unemployment tax law is a difficult and time-consuming task. The heart of this problem is that each state has its own set of unemployment tax rules and regulations and is also subject to federal laws, which are standard across all 50 states. 

Interpreting unemployment tax law is a complex undertaking as it is; the COVID-19 pandemic has added multiple layers of complexity to the process. Now, with additional legislation like the CARES act and FFCRA, it can be challenging to know where to turn when you have questions about your company’s unemployment tax obligations. 

In this article, we’re going to look at the critical components of unemployment tax law, discuss how current Coronavirus relief legislation modifies those existing rules, and establish a list of quality resources that you can turn to to get your important questions answered.  

Unemployment Tax: Key Things You Need to Know

Unemployment tax was first established under the Federal Unemployment Tax Act (FUTA) of 1939. This piece of legislation, which was created in response to the Great Depression, has evolved to address the modern workforce’s needs. The law was designed to offset unemployment’s social and economic impact by placing a portion of the cost onto employers in general. 

FUTA funds unemployment by collecting a payroll tax. However, it should be noted that this tax is only levied against you as a business owner, not against your employees’ paychecks. While the amount of tax that the federal government collects has changed over the years with updates to the legislation, the way that the tax is assessed has remained the same. Through 2020, the tax rate was set at 6% of the employee’s first $7,000 in wages per year. That means that the employer takes 6% from a minimal, predetermined amount rather than the employee’s overall salary. It should be noted that the tax is not assessed on employees who make $1,000 or less per calendar year. Tax is also not collected on employees aged 21 or under. 

The basic method for figuring out your company’s unemployment responsibility is:

  • $7,000 x 0.06= $420/employee/year
  • $420 x total number of employees= unemployment tax obligation

The current FUTA standard also makes a provision for a 5.4% tax credit, which results in a tax bill of $42 per employee every year. To qualify for the credit, your company must pay state unemployment tax and file form 940 (which is a yearly requirement anyway) with the IRS.  

The challenge to employers comes with state unemployment taxes, as every state administers its own unemployment program, and imposes an employer-funded tax levy. Below, we’ll provide a more comprehensive guide to available resources that can help you determine the rules for your particular state.   

When figuring your unemployment tax burden, you should inquire if certain types of payments are excluded from the overall calculation. Those types of payments include:

  • 401(k) contributions
  • Life Insurance
  • Fringe benefits and per diem payments
  • Childcare allowances

Employers are required to pay their unemployment tax quarterly throughout the year.

A Wrench in the Works: the CARES Act

Along with the COVID-19 pandemic, there came a surge in unemployment cases nationwide. At one point, the US economy suspended or eliminated more than 22 million jobs. Several legislative remedies were passed into law, including the FFCRA, which extended the definition of emergency paid leave. The CARES act offered additional unemployment insurance up to $600 dollars per week. There is an old saying, however: there’s no such thing as a free lunch. 

While the CARE Act served as a lifeline for many struggling families, there are tax implications to receiving that kind of governmental assistance. Employees who failed to set aside taxes might find themselves without their expected refund. 

For employers, the CARES act results in additional paperwork and due diligence. While the federal government fully funds the unemployment insurance itself, each state has its own mechanism for carrying out the program, complete with qualification requirements and reporting. The bottom line? Unemployment tax is already muddy water; pandemic-related legislation just opened the floodgates.  

Resources to Help

So the burden of understanding unemployment benefits and their associated tax burden falls to the employer. But with each state in charge of its own rules —on top of federal requirements— that’s no easy task. Information differs on a state-by-state basis, and even then, it can be difficult territory to wade through. Where to begin? 

The single best place to start your search is with the United States Department of Labor (DOL). They have a page set up specifically for employers that links to each state’s unemployment insurance program. This site gives employers a contact list at a glance and helps empower HR and accounting staff to find good, quality information on a state level.

To understand how unemployment insurance —including the CARES act— works for the employee, the DOL also offers a website geared toward the workforce filled with valuable information and necessary forms.  

For information on federal unemployment programs, the top-level governmental website, USA.gov, has an unemployment-related directory filled with information related to numerous national programs as well as additional high-quality resources. 

If, for some reason, the government-curated resources don’t answer your question, or you find them obtuse and difficult to use, numerous third-party organizations such as the Tax Foundation strive to bring up-to-date information to the American workforce, including employers. 

Enlisting Personalized Help

Understanding tax laws is difficult no matter what type of tax you’re working with. There is no substitute for getting advice from a professional resource. The Quentelle platform is proud to partner with the ValeU Group to provide unemployment tax planning services through our technology and consultancy expertise. For more information, please contact us today. 

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What Are Point-Of-Hire Tax Credits And Other Tax Credits?

Tax credits are always important for businesses in the challenging times we live in. While WOTC (Work Opportunity Tax Credits) are still available on a federal level, Point-of-Hire credits are also available in many states.

What should you know about Point-of-Hire credits, though? Take a look at our guide on how they work and how much potential tax credit savings you can enjoy. 

We’ll also look at other useful tax credits to consider throughout the year.

You can also find recent updates on Point-of-Hire credits from Quentelle and we will work to keep you up-to-date as things change moving forward.

How Much Money Could You Save with Point-of-Hire Tax Credits?

The savings your business could muster with Point-of-Hire tax credits range from a few hundred dollars to as much as $35,000 per employee. It all depends on the state where this credit is available.

So far, these credits are only available in eight states: Arizona, California, Illinois, Louisiana, New Mexico, New York, South Carolina, and Washington. Time-frames for claiming the credit all vary based on your particular state.

In Arizona, tax credits up to $9,000 are possible for each new net quality job created. It works over a three-year period with $3000 in credit per year. Credits of up to $9,600 are available to employers in California, with the renewal of WOTC credits occurring recently.

A list of other credit savings possible in states participating in Point-of-Hire credits:

  • Illinois: Tax credit equal to 40% of first-year wages if employees work more than 400 hours. In the second year, this credit goes up to 50% while working the same hours.
  • Louisiana: A 25% tax credit ($1,500) of qualified first-year wages for employees working 120 hours. This goes to 40% ($2,400) for employees working 400 hours or more.
  • New Mexico: Credits here are 40% on first $10,000 wages in the first year, then 50% of the first $10,000 earned in the second year.
  • New York: $1,500 is available in credits here to individuals who worked at least 120 hours, followed by $2,400 when working a full 400 hours.
  • South Carolina: Credits between $2,400 to $9,600 are available, with no limits on how many employees your business hires in a year.
  • Washington: Each qualifying hire here can get a credit up to $2,400, plus $9,000 for long-term family assistance recipients.

What is a Welfare-to-Work Tax Credit?

More federal tax credits are available beyond WOTC and the limited Point-of-Hire credits. The Welfare-to-Work credit is still a popular option since it helps bring businesses credits hiring those on government assistance.

In a more challenging time economically, this type of credit can bring a real sense of accomplishment in helping to reduce unemployment in America. What makes it so effective is it was enacted at the same time as WOTC back in 2007.

Using both of these tax credits can end up being a major benefit to your company in any tax year. Both are likely to stay active on a federal level indefinitely.

What Tax Credits Benefit Employees?

There are several different types of tax credits that can benefit the employees of a company and help them maximize their income. Informing employees about these tax credit opportunities not only increases their net earnings but can also help businesses retain financially satisfied employees.

Earned Income Tax Credit

Employees can take advantage of an EITC if they earn a low to moderate-income. It works more like a refundable tax credit for your workers, except it sometimes delays tax refunds.

Any delays on usual tax refunds with this credit are due to an IRS law requiring a bit of a wait. Still, it’s very beneficial for lower-wage workers in your company. Keep in mind employees with children are the ones who stand to get the biggest credit.

For 2021, credit ranges on an EITC go from $543 to $6,728, which is contingent on filing status and how many children a family has. One great thing about the EITC is employees can get credit from the last several years if they didn’t realize they qualified for it over that period of time.

Lifetime Learning Credit

Many of your employees may be seeking an education while working for you. If so, they can get a Lifetime Learning Credit. These go up to as much as $2,000, giving significant savings for your valuable workers.

Part of that education they’re getting might be related to bettering their own jobs. Obtaining credits on tuition and any other education expenses greatly benefits them, or their spouse. An employee can also use this on a dependent.

Individuals can take this credit if their educational expenses are at least $10,000. On an income level, an individual has to make under $69,000 to officially qualify.

The credit goes beyond ordinary tuition and allows one to also write off any additional fees associated with getting an education.

Saver’s Tax Credit

Another great tax credit is this one where employees can help save more money for retirement. It all depends on their adjusted gross income requirement. As with EITC above, this credit is designed for those with lower to moderate incomes. At one time, this was known as a Retirement Savings Contributions Credit.

To use this for 2021, a head of household can get 50% of their contributions if making under $29,625 per year. A married person filing jointly can also take 50% of contributions if making $39,500 or less.

Employees can’t take any credit if they make more than $49,500 as a head of household. For a married person, no credits apply if they make more than $66,000.

What if You Have No Tax Liability?

An interesting thing about federal tax credits is some of your employees can still take advantage of one if not owing taxes. They might still qualify for $1,000 in tax credits, meaning they could get a $1,000 refund as a result.

While these scenarios are rare, it might occur if having employees who are volunteering at the moment rather than taking direct pay.

Always remember that to claim any tax credits, you need to fill out Form 1040 at the IRS. Schedule EIC is another form to fill out if claiming the EITC and listing dependents.

Do you need to learn more about Point-of-Hire tax credits? Contact us at Quentelle to learn about our platform. Click here to learn how you can schedule a demo.

 

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Understanding Work Opportunity Tax Credits (WOTC) 

There are several Federal hiring incentive programs in the United States. One of these programs and perhaps the one with the longest tenure is WOTC, which stands for Work Opportunity Tax Credit. This program is designed to promote workplace diversity by hiring individuals who typically face barriers to secure employment.

More about WOTC:

The Work Opportunity Tax Credit provides a Federal tax credit to employers who hire and retain individuals from certain target groups. The goal is to increase workplace diversity and help people who have particular difficulty finding sustainable employment.  In the current version of the program, the target groups are as follow:

  • IV-A recipients. These are individuals whose  family is receiving TANF. To qualify, assistance must have been received for a 9-month period during the past 18 months.
  • Veterans whose families are receiving SNAP or who have been employed for four consecutive weeks or at least 6 non-consecutive months in the last year. It also includes disabled veterans.
  • Ex-felons hired within a year of conviction or release.
  • Designated community residents, that is people who live in select impoverished communities such as Rural Renewal communities.  To qualify, they must continue to live in those communities.
  • Individuals referred to Vocational Rehabilitation.
  • 16-17 year olds seeking summer jobs who live in one of the impoverished communities.
  • SNAP recipients. (Supplemental Nutritional Assistance Program – also known as food stamps)
  • SSI recipients. (Supplemental Security Income)
  • Long-term family assistance recipients.
  • Long-term unemployment recipients.

As you can see, the credit is a direct reward for hiring somebody who might otherwise have had problems finding and securing a job. It maxes out at the amount of business income tax liability or social security tax owed. It can be applied as a credit against business income tax liability.

What is Changing with WOTC?

Despite the rollercoaster ride 2020 has proven to be, we end the year on a high note. The 11th hour agreement reached by lawmakers on Sunday, December 20 will include a renewal of the Work Opportunity Tax Credit (WOTC)  through December 31, 2025.

The $900 billion COVID-Relief package, H.R. 133, “Consolidated Appropriations Act, 2021”  also includes host of provisions and programs within the bill, designed to provide relief to businesses impacted by the pandemic. The House of Representatives overwhelmingly voted to pass the bill 359-53 just hours after the final legislative text was released to members. The Senate followed suit by passing this bill with a 92-6 vote.

“Securing a long-term extension of WOTC was the right thing to do, as it ensures job applicants a chance to secure sustainable employment and gives companies an opportunity to find good talent and offset their corporate taxes as they recover from the impact of the pandemic.” said Phil Ownbey, President of Walton Management Services.  

While we hoped the renewal would also add pandemic-focused target groups, this extension does not include any changes to the program. However, this buys us some time to regroup and strategize our lobbying with the incoming administration.

Will the Pandemic Affect WOTC?

One key question is the potential effect of the COVID-19 pandemic and resulting economic disruption on WOTC. It’s clear that the pandemic makes extending the credit even more important. As the pandemic ends and recovery begins, encouraging employers to hire people who lost their jobs at the start of it and have been struggling since is likely to speed recovery, especially in disadvantaged areas.

The incoming administration has promised a better plan for dealing with the pandemic and depending on what happens with Congress, this could involve changes to WOTC. Two big changes might be considered:

  1. An audit of Empowerment zones and Renewal communities to potentially add towns and neighborhoods that have been particularly badly hit.
  2. The potential addition of more target groups. For example, COVID-19 is resulting in long-term sequelae for many patients, but most of these patients are getting better, if slowly. Many of these long COVID sufferers have lost their jobs and for those who do recover, finding new employment might be tough. Creating a temporary target group could be one way to assist them back into the workplace. Target groups might also be created to assist people in industries that were particularly hard hit.

Adjusting WOTC can be an easy way to incentivize employers to help bring back those who have been particularly hard hit by the pandemic, which has disproportionately affected minority communities.

How Do You Get WOTC?

Applying for the credit is simple, and there’s two ways to do it. In some cases state or local workforce agencies will provide qualified workers with a pre-certified form that they can give to you. Or if you believe your new employee falls into a target group, then you can fill out an individual-characteristics information form that explains how the person falls into a target group.

You then fill out a certification request form, obtainable from the IRS. It’s Form 8850, Pre-Screening Notice and Certification Request for the Work Opportunity Credit. This must be provided to the state workforce agency within 28 days of your worker’s first day. Assuming that the request is approved by the state agency by way of certifying the employee, you will then be able to add the credit to Form 3800 as a general business credit. You will also need to file Form 5884. If you are tax-exempt, you need to instead file Form 5884-C to get a credit against employer social security tax.

Some employers find out about WOTC for the first time when a new hire shows their eligibility form, but the intent of the program is to encourage you to seek out people who need a job badly and bring in people you might not have thought to hire.

If you are looking for tax breaks and also a way to help bring new and interesting viewpoints into your office, the Work Opportunity Tax Credit gives you a solid incentive to hire less traditional employees. It is, however, complex to understand. Quentelle’s human resource bundle can help with this and other employment-related tax issues. Contact us to find out more about our human resources software and how we can help you simplify employment and tax issues, including all point-of-hire credits.

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