OSPS E-News ~ January Pay Check Change

[Announcements from OSPS to the users of the Oregon State Payroll Application]

Hello everyone,

Below is a message that DAS Shared Payroll Services will be sending to their employees regarding the change back to 6.2% from the 4.2% Social Security tax rate that has been in place the past two years.  We are sharing this with you in case you would like to use, all or part of this, to notify your employees of the change they will see in their December-paid January pay check.  Be sure to complete or remove the final "who to contact" information in the message.  (We have also updated OSPA for the 2013 State tax rate changes.  The IRS has not posted 2013 tax rates so these remain at the 2012 rates until we are notified otherwise by the IRS.)

Thank you,
Sandy

Sandy Ridderbusch, Oregon Statewide Payroll Services - (503) 373-0198
Visit Our Online Resource Center: http://oregon.gov/DAS/EGS/FBS/OSPS/

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Good morning,

We just wanted to take a second to let you know how the "fiscal cliff" situation in Washington D.C. will directly impact the paychecks that state employees receive in January.

Since 2010, a payroll tax holiday has been in place that reduced everyone's annual Social Security payments from 6.2 percent down to 4.2 percent. Lawmakers in Washington have discussed extending this tax cut, which ends on December 31, but have not been able to agree on this or many other issues related to the "fiscal cliff."

The people who run the State of Oregon's payroll system needed to know by Monday whether or not the payroll tax holiday would be extended through next year. Without word from Washington that the holiday was being extended, they had to program the payroll system to reflect the increased Social Security rate of 6.2 percent.  We will all see this change in our January paychecks.  (If Washington decides at a later date to re-extend the reduced rate, Oregon Statewide Payroll Services will work on a process to assist with getting the 2% back from Social Security to employees.)

This means that employees will see an approximate 2 percent reduction in their January take-home pay, as Social Security tax withholding bumps back up to 6.2 percent. The reduction will remain in place unless officials in Washington agree to extend the payroll tax holiday.  This affects every American, whether they work in the private or public sector.

If you have any questions about this, please contact....
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