YEAR
2001 PAYROLL TAX HIGHLIGHTS
Important
Reminders Rates for 2001
New Jersey Rates
Below, we have summarized the major
changes, as of this date, which will affect your payroll tax calculations effective
January 1, 2001.
1. Federal individual income tax rates have remained the same for
2001. However, bracket amounts,
the standard deductions, and the phase-out of personal exemptions have been
adjusted for cost of living increases.
The personal exemption for 2001 will be $2,900.
(See schedule 1 for tax brackets, rates, standard deductions, and
phase out of personal exemptions).
2.
Social security tax is broken into two sections, Social Security and
Medicare.
section’s rate base for 2001:
Maximum
Maximum
|
Social
Security |
6.2% |
$80,400 |
$4,984.80 |
$4,984.80 |
|
Medicare |
1.45% |
Unlimited |
Unlimited |
Unlimited |
3. Federal Unemployment Tax remains at 6.2% with a maximum state credit of 5.4% for a net tax of .8% (.008)
on the first $7,000 of wages per employee.
4. The maximum taxable wages for New Jersey Unemployment and Disability will increase to $22,100 per
employee. The withholding rate remains the same at 0.925% (.00925). The employee percentage is
divided as follows:
|
0.200% |
(.00200) |
Healthcare
Subsidy |
|
0.200% |
(.00200) |
Unemployment |
|
0.025% |
(.00025) |
Workforce
development |
|
0.500% |
(.00500) |
SDI |
|
0.925% |
|
|
5.
The New Jersey individual tax remains the same as 2000. The tax rates start
schedule rising to a maximum tax bracket of 6.370%
(See schedule 2 for tax brackets and rates).
6.
The maximum taxable wages for Pennsylvania Unemployment remains at
The withholding
7. The Pennsylvania individual income tax withholding rate remains at 2.8% for 2001.
8. The withholding rate for Philadelphia's City Wage Tax was reduced, effective July 1, 2000, to 4.5635%
(.045635) for residents and 3.9672% (.039672) for non-residents. Employers will be notified if this rate
changes again in 2001.
1.
Electronic Funds Transfer Requirements (EFTPS)
Beginning
January 1, 2000 the threshold amount of
$50,000 of employment tax deposited was replaced by a threshold of
$200,000 of combined deposits (employment taxes and all other federal taxes)
for 1998. Only employers
exceeding this amount would be mandated to use EFTPS on or after January 1,
2000. Beginning January
1, 2000, the 10% penalty is applicable to businesses with aggregate annual
tax deposits exceeding $200,000.
2.
401(k) Limits
The maximum employee contributions remains at $10,500 for 2001.
Please note that this contribution is limited to the lesser of 15% of
wages or $10,500.
3.
Minimum Hourly Wage
Effective from September 1, 1997
Federal
$5.15
New
Jersey $5.15
Pennsylvania
$5.15
SCHEDULE 1: FEDERAL
PERSONAL INCOME TAX
RATES FOR 2001
Taxable Income
Tax Bracket
But Not
|
|
|
|
|
$
-0- - |
$
27,050 |
15 % |
|
27,050 - |
65,550 |
28 |
|
65,550 - |
136,750 |
31 |
|
136,750 - |
297,300 |
36 |
|
297,300 - |
Over |
39.6 |
Standard Deduction $4,550
Phase out of personal exemptions begins at $132,950
Married Filing Jointly and Surviving Spouses
|
|
|
|
|
$
-0- - |
$
45,200 |
15 % |
|
45,200 - |
109,250 |
28 |
|
109,250 - |
166,450 |
31 |
|
166,450 - |
297,300 |
36 |
|
297,300 - |
Over |
39.6 |
Standard Deduction $7,600
Phase out of personal exemptions begins at $199,450
Married
Filing Separately
|
|
|
|
|
$
-0- - |
$
22,600 |
15 % |
|
22,600 - |
54,625 |
28 |
|
54,625 - |
83,225 |
31 |
|
83,225 - |
148,650 |
36 |
|
148,650 - |
Over |
39.6 |
Standard Deduction $3,800
Phase out of personal exemptions begins at $99,725
Head of Household
|
|
|
|
|
$
-0- - |
$
36,250 |
15 % |
|
36,250 - |
93,600 |
28 |
|
93,600 - |
151,600 |
31 |
|
151,600 - |
297,300 |
36 |
|
297,300 - |
Over |
39.6 |
Standard Deduction $6,650
Phase out of personal exemptions begins at $166,200
*See
Circular E for withholding amounts that should be made through payroll.
SCHEDULE 2: NEW JERSEY INCOME
TAX RATES
NEW JERSEY INCOME TAX RATES UNCHANGED
New Jersey Income Tax Rates for 2001 will remain the same as the 2000
Income Tax Rates.
FOR MARRIED PEOPLE FILING JOINTLY, HEADS OF HOUSEHOLDS
AND SURVIVING SPOUSES
Taxable
Income
Tax Rate
Not
over $20,000
1.4%
$20,001
- $50,000
$280 plus 1.750%
of excess over $20,000
$50,001
- $70,000
$805 plus 2.450%
of excess over $50,000
$70,001
- $80,000
$1,295.50 plus 3.500%
of excess over $70,000
$80,001
- $150,000
$1,645 plus 5.525%
of excess over $80,000
Over
$150,000
$5,512.50 plus 6.370%
of excess over $150,000
FOR TAXPAYERS WHOSE FILING STATUS IS
SINGLE OR MARRIED PEOPLE FILING SEPARATE RETURNS
AND ESTATES AND TRUSTS THE RATES ARE:
Taxable
Income
Tax Rate
Not
over $20,000
1.4%
$20,001
- $35,000
$280 plus 1.750%
of excess over $20,000
$35,001
- $40,000
$542.50 plus 3.500%
of excess over $35,000
$40,001
- $75,000
$717.50 plus 5.525%
of excess over $40,000
Over
$75,000
$2,651.25 plus 6.370%
of excess over $75,000