During the first weeks of COVID, close to 45% of large and small employers moved to remote work. As time passed, employers realized that working at home may be a viable option, as well as a popular recruiting and retention tool. The ability to work at home also allows a business to recruit on a wider geographic basis. However, before hiring an employee in a State where other employees are not currently working, businesses need to take in account the following:

• Tax Withholding – State and local income taxes are based primarily on where the employee performs the services, which is a physical location such as an office or employee’s home, or secondarily, where the employee lives. Therefore, a new account  will need to be set up to submit State taxes if no other employees are working in that State. Currently, nine states do not have State income taxes, but check with the State to determine if local or other taxes are required.
• Worker’s Compensation –Verify Worker’s Compensation coverage is based on where employees are working and add the new location to the policy.
• Unemployment Insurance –Registration is required with the State to set up an account.
• Benefits – If benefits have a medical, dental or vision network, check to see if coverage is available for the location employee lives.
• State Laws – With more States passing Paid Family Leave, Salary disclosure and Disability laws, stay on top of each State’s laws and ensure compliance. 

​It is hard to believe that in six months, 2022 will be over! Time goes by fast and really seems to pick up as the end of the year nears. By doing mid-year audits, any corrections and changes can be made before the end of the year rush, saving time and money. Suggested audits include;

• Benefit Audits – Check benefit bills and eligibility lists from providers against reports produced by the HR/Payroll system to ensure all changes and updates match
• 401(k) and Simple IRA – Audit the recordkeepers information against Payroll to verify data agrees
• Payroll Reports - Review Quarterly Payroll reports for accuracy and confirm taxes are deducted correctly for out of state employees
• I-9’s – During COVID, the Department of Homeland Security allowed employers to temporarily used expired identity documents to meet the guidelines. By July 31st, employers must update the I-9s of current employees who presented expired List B documents between May 1, 2020, and April 30, 2022. Check I-9’s to see if identity documents need to be updates.

The audits listed above are a recommended. Depending on the type of business, other audits may be useful and most of the time, it is easier to do audits now instead of year-end. 

​The Internal Revenue Service (IRS) announced a special adjustment in standard mileage rates for the final six months of 2022 in recognition of gas price increases. For travel from July 1 through December 31, 2022, the standard mileage rates for the use of a car (van, pickup or panel truck) will be 62.5 cents per mile driven for business, up from 58.5 cents in January 2022.