Here you will find some frequently asked questions about bookkeeping, payroll and facts relevant to employers and business owners in Oregon. If you don’t find the answers you are looking for, feel free to ask – we love to help!
For a list of forms that you can download in PDF format, go to Forms and Publications on the IRS website.
Employees must be paid at least 1 ½ times their regular hourly rate of pay for every hour that they actually work over 40 hours in a workweek. A workweek is defined under federal law as any 7 consecutive days or 168 consecutive hours. Although the workweek does not have to be Monday through Sunday, it must be consistent, employees must be made aware of it, and an employer may not change it to avoid paying overtime.
There is often a lapse of time between the time wages are earned and the time they are actually paid. Wages are considered “constructively” (actually) received when funds are made available to an employee without substantial limitation. If paychecks are available to employees, but they do not pick them up, wages are taxable on the day when they could have claimed the checks. Occasionally an employee with request that a paycheck be postdated or backdated – this however does not alter the facts. The date of a check does not determine “constructive receipt” but rather the date the paycheck was made available.
Form 1099-MISC. is used to report payments of $600 or more for rents, commissions, fees, prizes and awards, royalties and other nonemployee compensation. They must be provided to the recipient by January 31st following the year in which the amounts were paid. They must be transmitted to the IRS by March 31st following the year in which the amounts were paid.
If a independent contractor fails to submit a TIN (Tax ID Number), or the IRS otherwise requires it, backup withholding tax is required on payments made to the independent contractor at a rate of 28% (can change annually).
Misclassification, even unintentional, may have serious consequences. Employers can be assessed 100% of the FIT (Federal Income Tax) and FICA (Social Security and Medicare) taxes that they fail to withhold. Be careful to qualify your independent contractors! If an employer is unsure whether an individual is an independent contract, it may obtain a written determination from the IRS by submitting Form SS-8. However Oregon may have additional requirements to consider as well. See http://egov.oregon.gov/EMPLOY/TAX/IC/whatisIC.shtml for more information.
This is an Oregon payroll assessment paid quarterly. Employers pay at least half of this assessment. The WBF assessment pays for certain programs that provide direct benefits to injured works and their beneficiaries. The fund also provides money to help employers help injured works return to work. Employers may deduct no more than half of this assessment from workers’ wages. Employers then submit the total to the state through Oregon’s Combined Payroll-Tax Reporting System (Quarterly Reports).
Oregon law specifically mandates rest and meal periods. Adults must be given a 30-minute meal period if the workday is six hours or longer. A meal period must be provided for minor workers no later than five hours and one minute after the minor reports to work. Minors ages 14-15 must be fully relieved of work duties at this time. Minors who are 16-17 and adults may work during the meal period under exceptional circumstances, if they cannot be relieved, but must be paid for that time.
Rest periods of 10 minutes during each four-hour shift are to be provided for adult workers. Minor workers must be provided a 15-minute break during each four hours of work. Rest periods may NOT be added to meal periods or deducted from starting time or the end of the work period to shorten the time worked.
If an employee quits employment and has given advance notice of at least 48 hours (excluding Saturdays, Sundays, and holidays), final pay is due on the last day worked. If the employee quits without 48 hours notice, final pay is due within 5 days (excluding Saturdays, Sundays, and holidays) or on the next regular payday after the employee quits, whichever is sooner.
If an employer discharges an employee, or if employment is ended by mutual agreement, all wages earned and unpaid must be paid by the end of the next business day after discharge or termination.
You can make your employer Federal Tax Deposits online. No more coupons, checks and trips to the bank to make your deposits. You can enroll at http://www.eftps.gov, or call 800-555-4477 for an enrollment form.
A filing system is necessary for quickly finding records. You may wish to divide your filing system into major divisions. These might include:
Bank Statements and cancelled checks (for up to 4 years as required by the IRS)
Customers / Contracts
Copies of all tax returns
Credit card receipts and Statements
Equipment and/or Tools
Proposals / Bids / Estimates
A semiweekly depositor is an employer with an accumulated liability of more than $50,000 in the lookback period*. They must deposit taxes for wages as follows:
When wages are paid on Wednesday, Thursday and/or Friday – no later than the following Wednesday. Tuesday, Saturday, Sunday and/or Monday – no later than the following Friday.
Deposit status can change each year. Employers are responsible for determining their own deposit status. Firms making late deposits may be penalized even if it was caused by assignment of an incorrect deposit status by the IRS.
*The lookback period is the July 1 – June 30 prior to the calendar year for which the deposit status is determined.
A Semiweekly depositors is also an employer that in the calendar year incurred a deposit obligation of $100,00 or more.
Under federal law, any seven consecutive days or 168 consecutive hours constitute a work week. Although it need not be Monday through Sunday, it must be consistent, employees must be aware of it, and it may not be continually changed to avoid paying overtime.
Oregon State laws require than an individuals unclaimed wages be submitted to the appropriate state agency within a specific time period. Access this link to discover how to comply with Oregon’s unclaimed property law.
According to the Department of Labor, temporary workers work 80-90% of the time; better than the 65-70% of productive hours full-timers tend to put in.
In Oregon an employer may deduct a $5 per month fee from the employee for processing a support order. Employers are required to send the withheld payment within 7 business days of payday – with a withholding limit of 50% of “disposable earnings”. If the support payment meets or exceeds the limit, you may reduce the amount withheld to collect your fee. It is advisable to notify the agency in writing if you reduce the amount withheld to obtain the fee. When you have questions, be sure to use the phone number in the order. Under “When to start withholding”, “Immediately” usually means the first payday no more than 5 days after receipt of order.