By Kate Schieldt, SHRM – SCP
MADISON, Jan. 2, 2020 — Contractors should be aware of changes in laws affecting human resources, beginning in 2020. Here’s a quick rundown:
New Federal Form W-4 for New Hires: The IRS released the final version of the 2020 form W-4, that has been retitled Employee’s Withholding Certificate. This has major revisions designed to make accurate income-tax withholding easier for employees.
New Wisconsin WT-4: All newly hired employees in Wisconsin will be required to provide Form WT–4 to their employers. Existing employees who change the number of their state withholding exemptions must also provide Form WT–4 to their employers.
FLSA’s New Overtime Rule Effective: Employees who earn less than $35,568 will be eligible for overtime pay under a final rule issued by the U.S. Department of Labor.
New Rules for Retirement Plan Hardship Withdrawals: The IRS has published a final rule that relaxes several existing restrictions taking hardship distributions from defined contribution plans. Some of the changes are mandatory, requiring employers to make the changes by Jan. 1.
Adjusted Retirement Plan Limits: The maximum retirement plan contribution is increased for 2020.
- The contribution limit is increasing from $19,000 to $19,500
- Catch-up contributions for people 50 years and older will rise from $6,000 to $6,500
Full repeal of the Cadillac tax on high cost health plans: The full repeal of the Cadillac tax on high-cost health plans was recently signed by President Trump as part of the spending bill also repeals two other Affordable Care Act (ACA) taxes on employers: the health insurance tax (HIT) on fully insured health plans and the ACA’s tax on medical devices (repeal effective 2020).
Leap Year (2020) Payroll: 2020 is a leap year, there is 29 days in February. This results in an extra pay day in the calendar year, depending how and when an employee gets paid … Are you ready?
Kate Schieldt is Director of Human Resource Member Services for ABC of Wisconsin.