Payroll Compliance Group The mission of the Payroll Compliance Group is to provide guidance and...
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STATE OF DELAWARE PAYROLL FORUM INAUGURAL MEETING WELCOME! NOVEMBER 12, 2013
Payroll Compliance Group The mission of the Payroll Compliance Group is to provide guidance and training to State Organizations on the proper administration
Payroll Compliance Group The mission of the Payroll Compliance
Group is to provide guidance and training to State Organizations on
the proper administration of Payroll functions; compliance with
applicable laws, rules, and regulations; and, maintaining effective
internal controls.
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PAYROLL COMPLIANCE GROUP (PCG) Debra Cormier State Payroll
Manager [email protected] 302-672-5543 Statewide Payroll
Regulatory Compliance Payroll Policies Debbie (Hurd) Ide State
Accountant IV [email protected] 302-672-5506 Payroll Planner
Internal Control Plans Payroll Administration Training Delivery
Adrienne Cobb State Accountant III [email protected]
302-672-5517 Payroll Authorizations Wage Overpayments / Repayments
Wilmington City Wage Tax Direct Deposit Participation Funding
Reconciliations
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Resources for Payroll Officers Division of Accounting Website
http://accounting.delaware.gov/payroll_comp.shtml PCG Policies
Explains Why Rules, Regulations, and Laws PCG Procedures Covers How
Step-By-Step Guidance PCG Bulletins Focuses on IRS Regulations and
Delaware Code Response to Organization Inquiries Conclusion of
Compliance Examinations Reviewed Annually for Regulatory Changes
PCG Memos and Alerts
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Resources for Payroll Officers Budget and Accounting Policy
Manual (BAM) http://www.budget.delaware.gov/accounting-
manual/account-manual.shtml Coming Soon: Payroll Compliance Chapter
14 PHRST Website http://extranet.phrst.state.de.us/ FSF Website
http://extranet.fsf.state.de.us/ Internal Revenue Service Website
www.irs.gov
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PAYROLL FORUM MISSION By drawing on the collective experience
of members Discuss recent developments, initiatives & practices
in Payroll. Leverage the hard-won lessons of seasoned
professionals. Sharpen skills thru exposure to new ideas and peer
networking. Promote the personal professional growth of
participants. Improve operational efficiency and enhance internal
controls. Ensure regulatory compliance is Priority 1 .
Educate.
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COMPETING PRIORITIES Tax Laws Pay Confirm Meetings Controls
System Changes Funding Who looks this relaxed while juggling all
this???
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Rule #1 Always Talk About Forum
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Rule # 2 Forum is a Judgment-Free Zone
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Rule #3 Forum Participants are Fearless Dont let the little
voice in your head thats trying to stifle your real voice win. This
is a safe environment remember Rule #2!
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Rule #4 Payroll Forum is about Sharing! Heres how we solved
that issue Thats a great idea! Did you hear about the latest tax
law? How did you get the word out? Does that apply to my employees?
Im not sure. Lets discuss it with the group. When is it effective?
I have to let my boss know! Oh, great I love Forum!
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Rule # 5 At the Payroll Forum We Dont Shoot The Messenger!
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PCG Especially if its ME!
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Rule #6 Theres No Crying in Payroll! in Payroll!!
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PCG INITIATIVES
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2012 2013 PCG Initiatives Payroll Administration Training
Currently Developing Chapters Coming in 2014 ! Statewide Compliance
Examinations Fringe Benefits Educational Assistance Programs
Internal Control Plans New Survey & Template Random Field
Audits Wage Overpayment/Repayment Policy & Procedure Payroll
Forum!!!
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PAYROLL ADMINISTRATION TRAINING TOPICS Over 20 Chapters of
Content In The Works: Payroll Repayments Paychecks and Advices
Internal Control Plans Worker Classification Form W- 4 Coming:
Taxation Fringe Benefits Payroll Calculations More!
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BREAK
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Fringe Benefits Examination Statistics
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UNREPORTED FRINGE BENEFITS BY TYPE
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TAX EXPOSURE CALENDAR YEAR TOTALTAX RATE 2009341,437.0040.3%
2010539,292.0040.3% 2011454,193.0038.3% 2012262,250.0038.3%
Total1,597,172.00 Taxable Non-Wage Compensation 1,597,172.00 Income
Tax & OECs40.3% or 38.3% Taxes Owed$629,332.00
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Open Discussion
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Fringe Benefits Where does the IRS Start?
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Everything is Taxable Unless a specific IRS exemption applies,
all payments or items of value given to employees are considered
compensation, and are subject to federal, state, and local (if
applicable) income tax and associated OECs. Fringe benefits include
any compensation other than cash wages. The Internal Revenue Code
(IRC) provides exclusions for numerous forms of noncash
compensation provided to employees. Working Condition Fringe
Benefits are excludable from taxable income.
Educational Assistance Refer to PCG Bulletin 2013_001 Coming:
Educational Assistance Model Program Section 127 Multiple-Job
Employees When aggregate reimbursements for non-job-related courses
from all State Organizations reach the $5,250 threshold, all future
non-job-related course reimbursements from any Organization are
taxable. Coming: PCG Policy Aggregate Reimbursements
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Payroll Authorizations
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Improved Simpler Process: Review Confirmed Reports Compare to
FSF Reports Submit Verification email on or Before Payday Done!
Establish Base-Line for Effective Internal Controls Organizations
can implement additional Internal Controls Audited EVERY Year Keep
Your Authorized Signature Cards Current Submit Your Funding
Authorizations Timely
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Wage Overpayments Payroll Repayments
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Necessary Tools PCG-OVRPAY Wage Overpayment Policy Rules &
Regulations to consider when Recouping Funds PCG-REPAY Payroll
Repayment Procedure Step-by-Step Instructions; Repayment
Calculations; Employee Notifications; Repayment Agreements; Record
Corrections Supporting Process Forms: Worksheets (Current &
Prior Year) Notification of Wage Overpayment Form (Current &
Prior Year) Payroll Repayment Form PayBreezeII
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Whats Changed? Recovering Funds Through PHRST Payroll System:
Current Year: Reduce Wages (ARO/Other Earning Code) Prior Year:
After-Tax Deduction Code PAYDUE Timely Repayments: < 6
months/Current Year Employee Approvals: Not Required Outstanding
Balance Deducted From Final Payout Overpayments > $2500.00 are
reported to Secretary of Finance, Attorney General, Auditor of
Accounts Employee Notification of Wage Overpayment Form: Explains
Overpayment & Outlines Repayment Plan
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Whats Changed? (cont) Non-Responsive Employees: Begin Recouping
Funds on Next Paycheck Alternative Options: Attach wages through a
Garnishment Accrue 1 % Interest on outstanding balance Report
Unpaid Balance to State of Delaware Tax Refunds and/or Attorney
Generals Office
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Payroll Repayments Any questions, Call Adrienne Cobb, PCG,
672-5517 Importance of Accurate Forms and Repayment Checks
Confidence Buster: Over- or Under-Charging an Employee Forms are
Used to Correct Records in PHRST System Forms are Used to Correct
W- 2 Information
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Payroll Internal Control Plans
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Establishes, Maintains, and Assesses Controls in Place to
Protect the Integrity of Sensitive Payroll Data Reflects
Transparency and Accountability to Taxpayers New Format Used for FY
2014 The PICP Plan The PICP Questionnaire
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Payroll Internal Control Plans Round 1 FY 2012 (Plans Only)
Just over half complied Plans not Uniform Across the State
Segregation of Duties not Apparent on Some Plans Round 2 FY 2014
(Plans and Questionnaire) 90 % Compliance Plans are More Uniform
Across the State Easier to Detail Segregation of Duties
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Payroll Internal Control Plans Whats next. Plans and
Questionnaires Reviewed & Scored Organizations will be sent
Written Reviews Random Organizations will be visited by ICE
team
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Closing Remarks
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Payroll Officers Must Be Fearless Go Ahead! Poke the Bear! IRS
Auditor Status Quo Complacency Payroll
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Questions
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Evaluation / Survey How Did This Inaugural Meeting Go? List
Topics For Future Meetings Complete Survey