Posted on January 31, 2011

What's New for 2011

* Percentage Method Tables and Wage Bracket Tables for Income Tax Withholding were developed as a result of the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010.
* The employee tax rate for Social Security is 4.2%.
* Making Work Pay Credit expired in 2010 adjusting withholding tables.
* COBRA premium assistance credit extended to involuntary terminated employees between September 1, 2008 and May 31, 2010 for premiums paid up to 15 months.
* Advanced Earned Income Credit expired. Individuals eligible for EIC in 2011can claim the credit on their 2011 federal income tax return.
* Federal tax deposits must be made by electronic funds transfer.
* Federal withholding allowance on an annual basis is $3,700.
* Aggregate Form 941 and 940 filers must complete Schedule R.
* Employers can choose to file Forms 941 instead of 944 by contacting the IRS.
* Employer Health Insurance reporting is optional for 2011.

For more information on these topics, go to www.irs.gov.