Your payroll software should take care of this

Your payroll software should take care of this, and you should begin using the new rate of 4.2% effective January 1, 2011.The IRS realizes that the late enactment of the Tax Relief Act of 2010 could make it difficult for employers to change their payroll system so quickly. So the IRS is asking employers to adjust their payroll systems as soon as possible, but not later than Jan. 31, 2011.

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