Start the New Year off right by learning about new laws -- on the federal, state, and local levels -- that will impact your business. Doing this now will help you adjust quickly and avoid problems later on.
New federal laws
New laws and regulations take effect on January 1. Here are some selected items of note:
Affordable Care Act Provisions. As you probably know by now, employees' flexible spending account (FSA) contributions are limited by law to $2,500; previously your company was able to set any limit. Check guidance on how this limit impacts your business. Other changes from this law taking effect on January 1 include:
- The deduction for employer subsidiaries for retiree drug coverage is no longer available.
- The 2.3% excise tax on the sale of medical devices.
- States must indicate to the Secretary of Health and Human Services whether they will operate an American Health Benefit Exchange. This could impact your decision on whether to provide health coverage for staff starting in 2014 or let employees join exchanges.
Payroll taxes. The Social Security wage base for 2013 is $113,700 (up from $110,100 in 2012). This is the maximum amount on which you pay the Social Security portion of FICA for each employee. Other changes:
- Mandatory employer withholding for the new 0.9% additional Medicare tax on taxable wages. This obligation is triggered when payments to an employee exceed $200,000. Find more guidance on this employer obligation from the IRS.
New state and local laws
The number of changes to state and local laws are numerous. Here are some select changes to note:
Minimum wage. The federal minimum wage remains at $7.25/hour, but a number of states have higher hourly minimums, which supersede it.
Here are the changes effective on January 1:
- Arizona: $7.80/hour
- California (San Francisco): $10.55/hour
- Colorado: $7.78/hour
- Connecticut: $8.50/hour
- Delaware: $7.75/hour
- Florida: $7.79/hour
- Missouri: $7.35/hour
- Montana: $7.80/hour
- New Mexico (Albuquerque): $8.50/hour
- Ohio: $7.85/hour
- Oregon: $8.95/hour
- Rhode Island: $7.75/hour
- Vermont: $8.60/hour
- Washington (other than workers age 14 or 15): $9.19/hour
Idea: Post any updated state posters reflecting minimum wage changes.
Other changes impacting employers:
New laws impacting driving (which may require you to update distracted driving policies for company car use or when driving personal vehicles on company business):
This is only a brief survey of new laws for 2013. Be sure to check what's new in your area. When in doubt, ask your legal advisor.