Tax changes may result in more take home pay for employees

As a result of federal tax changes that took effect Jan. 1, 2011, some employees may see an increase in their pay beginning this month.

Among the changes include a reduction in the employee portion of the Social Security tax was reduced from 6.2 percent to 4.2 percent for calendar year 2011. This reduction would appear on Duke pay statements under the OASDI heading in the Taxes section.

Duke has also updated calculations based on new federal tax tables for 2011. These changes could also result in a pay increase for some employees.

These changes will be reflected in any checks dated on or after Jan. 1, 2011, including the Jan. 14 pay statements for biweekly-paid staff and the Jan. 25 pay statements monthly-paid staff.

Below are details related to the changes:

Biweekly Payroll

The changes that affect the 2011 pay calculations are included below.

1. Federal Income Tax tables were updated. As a result of these changes to federal tax calculations, some employees may see an increase in their pay.
2. The OASDI employee portion of the Social Security tax was reduced from 6.2 percent to 4.2 percent for calendar year 2011 only. Employees may see an increase in pay due to a decrease in the OASDI taxes withheld.
3. The Medicare tax rate will remain unchanged at 1.45 percent.
4. The North Carolina Department of Revenue has not released any changes to the tax tables for state taxes.

Monthly Payroll

The changes that affect the 2011 pay calculations are included below.

1. Income Tax tables were updated. As a result of these changes to federal tax calculations, some employees may see an increase in their pay.
2. The OASDI employee portion of the Social Security tax was reduced from 6.2 percent to 4.2 percent for calendar year 2011 only. Employees may see an increase in pay due to a decrease in the OASDI taxes withheld.
3. The annual OASDI limit remains unchanged at $106,800.00.
4. The Medicare tax rate will remain unchanged at 1.45 percent.
5. The North Carolina Department of Revenue has not released any changes to the tax tables for state taxes.

Employees who have questions should contact Corporate Payroll Services at 684-2642. For specific questions about withholding requirements, visit the IRS website or discuss with an accountant or tax advisor.