For your information, please find some interesting points from the May newsletter for Professional Bookkeepers:

“The IRS has agreed to a new safe harbor method for certain payroll liabilities. According to the new rule, an employer will be able to deduct its payroll tax liability in the same year in which all events that establish the liability to pay related compensation occur-and the amount of the related compensation liability can be reasonably determined. In other words, the taxes can be deducted in the same year the compensation is earned. This applies to wages as well as deferred compensation such as vacation pay. The payroll tax liability must be a recurring event. Also, the compensation must be paid by the earlier of the date that the taxpayer files the return for the year (including extensions) or the 15th day of the ninth calendar month after the close of the taxable year. This change in the rules is considered a change in the accounting method. The change is effective to tax years ending after December 31, 2007.”

Massachusetts news: Employers of at least 11 full-time equivalent employees must get a completed Employee Health Insurance Responsibility Disclosure Form from each employee declining employer-sponsored insurance programs, including 125 plans. Download at www.mass.gov/Eeohhs2/docs/dhcfp/g/hcr/employee_hird_08.pdf

Why would a company want to reimburse employees using a flat per diem instead of actual expenses?

Per Diem allowances require no collection of receipts from employees traveling on business away from home. The employee substantiates only the time, place and business purpose of the expenses.