All posts by Legislative Update

Get an overview of everything you need to know for the key updates and changes of the 2025 Form W-2 recently released by the IRS.

Ohio's Pay Stub Protection Act requires employers to provide employees with access to a statement of their earnings and deductions.

Michigan SB 40 establishes weekly benefit amounts for each of an individual’s dependents, increasing the maximum weekly benefit amount and weeks available.

Michigan SB 975 updates language for when an individual is presumed to have voluntarily left work if absent for three consecutive workdays.

On January 8, 2025, President Joseph R. Biden, Jr. declared a major disaster exists in the State of California ordering Federal aid. The aid is set to supplement State, tribal and local recovery efforts in areas affected by wildfires and straight-line winds.  President Biden’s declaration makes Federal funding available to those affected in Los Angeles County. Effective Date January 7, 2025 Implication to Stakeholders Business owners and residents who sustained losses in the designated areas may apply for disaster unemployment (DUA) benefits at www.disasterassistance.gov. Other ways to apply are by phone at 800-621-FEMA (3362) or by using the FEMA App. Recommended Action Employers should be aware of this so they can notify any employees who may be impacted and eligible for DUA. 

On December 24, 2024, President Biden signed HR 3797, the Paperwork Reduction Act, which deals with an alternative manner of furnishing health insurance coverage statements to employees—specifically the 1095-C.  (The 1095-C provides coverage information to employees regarding health insurance options offered by Applicable Large Employers). Key Changes of the Paperwork Reduction Act related to Affordable Care Act (ACA) reporting: Allows employers the option to use covered individuals' full name and date of birth if unable to collect TINs (for statements due in 2025) Increase from 60 to 90 days to respond to IRS Notices related to proposed assessments (beginning in 2025) This is a Federal change, so any states with paper furnishment requirements may still be in play Prior to this amendment, the 1095-C had to be furnished to each employee in hard copy format, with a due date that was permanently extended to an automatic 30-days beyond the January 31 due date, which for calendar year 2024 would be March 3, 2024. The new requirement states that an ALE normally required to furnish such statements would be allowed to furnish them in an alternate manner if they provide “clear, conspicuous and accessible notice” regarding how to request a copy and that notice must be provided “not later than the later of…” January 31 of the calendar year for which the return was required, or within 30 days of receiving the employee request. The newly signed measure retains the original effective date that shall “apply to statements for calendar years after 2023.” Employers awaiting IRS guidance may look to the process established for the 1095-B to guide their transition. We will continue to monitor for new legislation or publications in the event any dates related to this Paperwork Reduction Act are altered. It will be important to watch states react to the federal law, as several states have their own reporting requirements. Stay tuned to this space for updates on both federal and state ACA reporting requirements. The full language of the bill can be found here.

The IRS has unveiled a draft of the 2025 Form W-4 with several key updates and changes to improve clarity and usability for employees.

Delaware HB 433 changes the unemployment rate calculation from a benefit wage to a benefit ratio, making it more responsive to economic changes.

Proposition A in Missouri would adopt an Earned Paid Sick Time law for the state. Learn what this would mean for employers and employees.

Illinois Governor J.B. Pritzker recently signed Illinois Senate Bill 0508 into law. This new law amends the already existing E-Verify law by adding protection for employees experiencing negative results from E-Verify. The new requirements go into effect on January 1, 2025, but employers should expect some clarification surrounding the process from the Illinois Department of Labor, (IDOL), prior to that date. The law states that it does not require any employer to enroll in any electronic verification system, including E-Verify, but also contains some confusing language that appears to limit usage in the state by saying “an employer shall not impose work authorization verification or re-verification requirements greater than those required by federal law.”  This wording will likely be officially clarified before the effective date, as the intent is to allow voluntary participation while adding specific guardrails. While the law restates some previous E-Verify requirements, such as not taking adverse employment action based on a notification of discrepancy alone, it adds provisions for notifications to employees in the event the employer receives a “Notice of Inspection.”  A new template for a posting providing the required information is currently in development at the IDOL. Additionally, employers are now required to provide notice to employees within a specified timeline when discrepancies are identified. Employers must provide notice within a specified timeline of 5-7 working days depending on the nature of the discrepancy. There are penalties associated with violating this act, and if such a violation is deemed to include intent, penalties can range from $2,000-$5,000 for a first offense. We expect clarification on the poorly worded sections of the amendment as well as possible legal challenges for any E-Verify infringements prior to the effective date of January 1. Stay tuned for updates on this situation.

Employers who have employees working in a large number of states have to manage a number of complexities to ensure tax withholding compliance. Employee Tax Withholding Allowances Over 40 states in the U.S. collect state income tax directly from workers’ paychecks. The Form W-4, used to determine the amount of tax to withhold, underwent significant changes in 2020, leading many states to develop their own forms or adjust their tax tables. Not all workers need to submit a new state form, but it’s recommended to check the state tax agency website for more information. Employer Responsibilities Employers must maintain federal and state tax forms for each worker. If a worker doesn’t provide a complete, signed federal Form W-4, the employer must withhold federal income tax as if the worker were single or married filing separately. Most states follow the same rule for state income tax. Exemptions Some workers may claim exemption from federal and state income tax withholding. Each state has its own rules about exemption from state income tax and the form a worker must file to support the exemption. Nonresident Military Spouses The federal Military Spouses Residency Relief Act (MSRRA) allows a servicemember’s spouse to designate a different state as their domicile and pay taxes to that state. The Veterans Benefits and Transitions Act of 2018 (VBTA) modified the law to allow spouses of servicemembers to choose to use the servicemember’s domicile for state taxation, irrespective of the marriage date. Recordkeeping Requirements Most state income tax withholding laws have similar recordkeeping requirements to those of the IRS for federal income tax withholding. These requirements typically include keeping track of returns and statements filed with the state revenue agency, dates and amounts of tax deposits, the total number of employees subject to withholding, and more. Compliance in these areas is crucial to avoid potential penalties and ensure accurate tax withholding. Employers should stay updated on changes to tax laws and forms, maintain thorough records, and ensure they’re withholding the correct amount of tax for each employee. It’s also important to respect exemptions and understand the specific rules for nonresident military spouses. By doing so, employers can ensure they’re meeting their legal obligations and providing accurate information to their employees. Here are some recent legislative updates regarding tax withholding that employers should be informed about. Updates effective 7/1/2024 Georgia G-4 Form Update:  The state of Georgia has released an updated version of the Georgia G-4 form. The update specifically affects Line H, where the value has been increased from $3,000 to $4,000. This change is effective from July 1, 2024. For more details, please refer to the official form. Learn more Addition of Blanchester Village, Ohio: Effective from July 1, 2024, Blanchester Village in Ohio has been added. For more information about this update, please visit the official page. Learn more Addition of College Corner Village, Ohio: College Corner Village in Ohio has been added effective from July 1, 2024. More details can be found on the official page. Learn more Addition of Glenmont Village, Ohio: Glenmont Village in Ohio has been added effective from July 1, 2024. For more information, please visit the official page. Learn more Addition of Holmesville Village, Ohio: Holmesville Village in Ohio has been added effective from July 1, 2024. More details can be found on the official page. Learn more Vermont Child Care Contribution Tax: The state of Vermont has added the Child Care Contribution tax effective from July 1, 2024. For more information about this new tax, please refer to the official document. Learn more Please note that it’s always a good idea to consult with a tax professional or the respective tax authorities for the most accurate and up-to-date information.

Summary, recommendations and next steps for Washington HB 1901 related to unemployment.

Summary, recommendations and next steps for Virginia SB 381 related to unemployment.

Summary, recommendations and next steps for South Carolina HB 3992 related to unemployment.

Summary, recommendations and next steps for Oklahoma HB 3596 related to unemployment.

Summary, recommendations and next steps for Oklahoma HB 3595 related to unemployment.

Summary, recommendations and next steps for Kentucky SB 140 related to unemployment.

Summary, recommendations and next steps for Kansas HB 2570 related to unemployment.