Thursday, July 24, 2008

Federal Minimum Wage Increase

The federal minimum wage increases from $5.85 to $6.55 per hour, effective today, July 24, 2008. The minimum wage will increase to $7.25 next year.

Note that the California minimum wage applicable to California employers and employees is already higher than the current or future federal increases.

Tuesday, July 15, 2008

Employee versus Independent Contractor

California's Employment Development Department (EDD), in conjunction with the Internal Revenue Service (IRS), is offering a seminar on employment status issues; that is, whether a worker is an employee or independent contractor. The seminar is available live from time to time, but also online as a webinar or on CD, free. The seminar offers an overview of California law in this area, as well as debunking some common employer misconceptions.

CA EDD Payroll Tax Seminars

Tuesday, July 1, 2008

IRS Increases Standard Mileage Rate

The IRS has announced that, effective July 1, 2008, the standard mileage rate will increase from 50.5 cents per business mile to 58.5 per business mile. The change is in recognition of higher gasoline costs.

The medical and moving rate also increases, from 19 to 20c per mile, but the charitable purposes rate of 14c remains unchanged.

The 2009 mileage rate has yet to be determined and announced.

To those Californians that wonder, if - given the higher gas costs here - the rate varies state by state, the answer is no, although, for some taxpayers in certain instances, using actual automobile operating expenses rather than the standard mileage rate is an option that should be discussed with their accountant. Employers typically reimburse employees for business miles at the IRS standard rate.