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5500 Preparer's Manual for 2012 Plan Years
The premier resource in the field of Form 5500 preparation, 5500 Preparer's Manual will help you handle the required annual Form 5500 filings for both pension benefits and welfare benefit plans.
from Spencer’s Benefits Reports: On July 18, the Internal Revenue Service released 20 questions and answers to provide employers and payroll service providers information to help them as they prepare to implement the Additional Medicare Tax which goes into effect beginning with taxable year 2013. The Additional Medicare Tax, implemented by the Patient Protection and Affordable Care Act (ACA), applies to individuals’ wages, other compensation, and self-employment income over certain thresholds. Employers are responsible for withholding the tax on wages and other compensation in certain circumstances. The IRS has prepared these Q&As to assist employers and payroll service providers in adapting systems and processes that may be affected.
The additional Medicare tax, in addition to the regular 1.45 percent Medicare tax that applies, is 0.9 percent and it applies to tax filers whose wages and compensation in a calendar year exceed the following thresholds:
| Filing Status | Threshold Amount |
| Married filing jointly | $250,000 |
| Married filing separately | $125,000 |
| Single | $200,000 |
| Head of household (with qualifying person) | $200,000 |
| Qualifying widow(er) with dependent child | $200,000 |
The Q&As clarify that the employer does not need to advise an employee when the additional tax is applied nor is the employer required to match the additional tax. The employer calculates wages for purposes of withholding additional Medicare rax in the same way that it calculates wages for withholding the existing Medicare tax and must include the value of noncash fringe benefits.
The ACA also creates a new Medicare tax on investment income. For tax payers with investment income, they also could be subject to a new 3.8 percent tax on at least a portion of their capital gains and dividends.
For more information, visit http://www.irs.gov/businesses/small/article/0,,id=258201,00.html.
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