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105 comments

Siren voice.... (5, Funny)

spaceplanesfan (2120596) | about 2 years ago | (#38433330)

Attention! We need you, all you COBOL programmers!.

Re:Siren voice.... (2)

Slashdot Parent (995749) | about 2 years ago | (#38435426)

Attention! We need you, all you COBOL programmers!.

Heheh. But seriously, payroll software is designed to handle arbitrary changes in the tax rates. A simple update of tax tables is all that would be required to deal with this. Assuming your employer's trusty accountant remembers to do it.

Multiple tax tables (2)

tepples (727027) | about 2 years ago | (#38435534)

A simple update of tax tables is all that would be required to deal with this.

Unless a program's tax table data structure isn't sufficiently fine-grained to deal with multiple tax tables that apply to different parts of a single year.

Re:Multiple tax tables (4, Informative)

Slashdot Parent (995749) | about 2 years ago | (#38435610)

Unless a program's tax table data structure isn't sufficiently fine-grained to deal with multiple tax tables that apply to different parts of a single year.

I can't speak for all payroll software packages, but QuickBooks can definitely handle this. All rates are specified with arbitrary effective dates. I'd be shocked if any payroll system could not handle mid-year changes. Stuff changes mid-year all the time.

Re:Multiple tax tables (2)

tepples (727027) | about 2 years ago | (#38435676)

Thank you for the information. Now I have a second question: If payroll tax has always been a flat percentage, does the infrastructure exist in QuickBooks to support a switch to a tax schedule that's progressive like income tax? Other comments to this topic explain how the first $18,000 or so is taxed at a lower rate.

Re:Multiple tax tables (2)

Relayman (1068986) | about 2 years ago | (#38437092)

Payroll tax since 1980 has not been a flat percentage. The graduated tax rates are built into the income tax table. The OP is talking about Medicare and FICA tax rates which have been flat but also the same for the whole year.

Re:Multiple tax tables (2)

matthewd (59896) | about 2 years ago | (#38440714)

"Payroll tax" is often used to refer to the Social Security tax, when one wishes to obscure the nature of the tax (ie that it funds the Social Security program). "Withholding tax" is more normally used to refer to federal income tax based on the income tax tables.

What the Senate bill did on the Social Security tax was set a limit of $18,350 (1/6 of 110,100, the limit for the entire year) for the first two months of the year that the 4.2% rate applies to. 6.2% applies above that limit. After the first two months of the year, rates are yet to be determined.

So instead of a simple calculation involving a single rate and a single wage limit for the employee portion for the entire year, we have three rates, two for the first two months and one for the last 10 months, and two limits that apply. For reporting the quarter totals (Form 941) employers would need to report the total wages for the first two months below $18,350, and the total wages above $18,350 along with the total wages for the third month in the quarter.

I would be very surprised if any payroll software were capable of handling this calculation for the Social Security tax right now. Up until now, there was no reason to build such a ridiculous calculation into your payroll software.

It seems like to me that it used to be that politicians, or at least their staff, had some inkling of the real world effect of changing tax policy, and the need for lead time for the IRS and SSA not to mention software vendors to adjust to these changes. At the worst, changing tax rates, calculations or reporting requirements should be done at the end of quarter if not the year.

News reports suggest to me that the only sticking point between the Senate and the House is how to fund the bill. The two month time frame apparently came about because that the Senate and House only agreed to funding sources that totaled enough to continue the tax break for that period of time.

Re:Multiple tax tables (2)

Sloppy (14984) | about 2 years ago | (#38437288)

Stuff changes mid-year all the time.

Stuff does, but for these taxes I think this may be the first time in history. (I'm admittedly a few years behind the times on this one.) If the software naively treats taxes in a special way different from the myriad other withholdings and expenses, I can see this being a slight pain in the ass. Back when I was working on this stuff, the 1987 version of our program would not have been able to handle this, whereas the 1988 version could, because unifying the code simply made things easier. Call the former behavior stupid if you want, but when you inherit a maintenance legacy, all you care about is all the work you have to do, not whose fault it is. And payroll reeks of being a world of legacy, where no one is writing brand new applications, so I'd expect there to be plenty of crazy limitations out there.

(Income tax withholding changed mid-year a few times if I recall, but one of the things about income tax is that being spot-on with the withholding isn't really all that important. If someone has to manually change rates mid-year and misses it by a week or two, it really doesn't matter, because people "settle up" when they file their tax returns every year. Close is good enough. Not so with Social Security and Medicare. If you screw it up then you have to adjust for it in later checks.)

Not that legacies excuse anything; sometimes maintainers just have to suck it up and do the work.

But software issues aside, I think lowered Social Security and Medicare withholdings and accrued employer expenses is just plained whacked, unless we're giving up on Social Security. If that's the plan, then those assholes need to come out and say it. DEFUNDING Social Security while keeping the pretense that it'll real, is just plain dishonest.

It's valid to either cut revenue and services, or increase revenue and services, but anyone who cuts revenue and says the services will still be there, is just another lying Republicrat scumbag.

Re:Multiple tax tables (1)

mattack2 (1165421) | about 2 years ago | (#38440268)

I could be wrong, but I thought in the past there have been 'manual' fixes (e.g. in payroll of companies), which ended up with a payment to the employee as correction on the next paycheck for example.

Re:Siren voice.... (2)

mrmtampa (231295) | about 2 years ago | (#38435956)

Attention! We need you, all you COBOL programmers!.

It's a twenty minute task but I'll have to bill by the month.

Re:Siren voice.... (0)

Anonymous Coward | more than 2 years ago | (#38443284)

I write software for a Payroll company and changing the tax tables are easy. What will be a nightmare is Quarterlies and Year-End (W2's) How will the government know what you owe tax wise. You will probably need to be issued two W2's, it snowballs down from there

Hardly a Surprise (2, Insightful)

Anonymous Coward | about 2 years ago | (#38433356)

The possible extension -- or not -- of the reduced payroll tax has been discussed in the news for some time. I'd hope that at least some of the people who maintain these systems have been paying attention. It's just a change in the withholding tables, after all.

Re:Hardly a Surprise (3, Insightful)

skids (119237) | about 2 years ago | (#38434176)

It's just an extension. If some payroll department cannot handle this, how did they handle the original tax break? Add to that, why is it suddenly Obama's fault that the congress can't get its act together and pass a clean bill (e.g. one that doesn't have a "lets grind up orphans and serve them in school lunches" provision or whatnot.)

Re:Hardly a Surprise (0)

Galestar (1473827) | about 2 years ago | (#38435330)

Add to that, why is it suddenly Obama's fault that the congress can't get its act together and pass a clean bill

Because everything's Obama's fault! Having you been watching the Republican primary debates? They tell you every 5 minutes.

Other than when the ball drops (1)

tepples (727027) | about 2 years ago | (#38435552)

If some payroll department cannot handle this, how did they handle the original tax break?

Might they have handled it by assuming that all such tax breaks will start and stop when the ball drops on New Year's Eve?

Re:Hardly a Surprise (1)

internerdj (1319281) | about 2 years ago | (#38436748)

According to a similar article I read this morning, the democrats had worded their bill such that the rich would get minimal effect out of the two month extension. Something like extending it for the first $18350 of everyone's salary, the rest of the tax cut would come in the "rest of the year extension." If they didn't do that then the rich get their full benefit during the two month extension and have no benefit from an extension. If they had been voting on a full year plan then yes it would be a stupid argument, but the two month extension as worded was a significant coding change.

Srsly? (4, Informative)

Anonymous Coward | about 2 years ago | (#38433358)

They'll load a different tax rate table. I'm sure it's modular enough they can just change a table (or two, or three) and be done.

Seems easy to me. But then I write software for a living, so what would I know.

Re:Srsly? (3, Insightful)

Anonymous Coward | about 2 years ago | (#38433526)

Yea, I have to say, this is only a complicated change for seriously poorly written payroll software. And are we really making the argument that in the middle of a massive recession it's acceptable to have our economic policy handcuffed because someone wrote some really crappy payroll software and doesn't want to fix it?

Re:Srsly? (3, Informative)

spudnic (32107) | about 2 years ago | (#38434330)

This is exactly it. And almost every shop that processes payroll subscribes to a service that updates the tax tables for you as the laws change. www.bsi.com is one.

I'm sure they have the tax tables written up either way the vote goes so they can get it out the door.

Re:Srsly? (1)

Relayman (1068986) | about 2 years ago | (#38437136)

But what one commenter pointed out is that they're changing the way the tax is calculated. That'll require a software change.

Re:Srsly? (1)

spudnic (32107) | about 2 years ago | (#38437500)

In my example, all tax is calculated in the BSI software. It talks directly to the ERP. There are a handful of tax software companies like this. Very few HR/Payroll systems actually calculate their own taxes. Too much to keep up with, especially if you had to keep up with all of the crazy county/parish/municipality taxes for all potential places where any of your employees live.

Re:Srsly? (1)

Translation Error (1176675) | about 2 years ago | (#38437302)

And it's not like tax table changes are rare events to begin with. I used to maintain the payroll software for our small business, and we'd typically get a few tax table updates each year.

Seems (0)

Anonymous Coward | about 2 years ago | (#38433392)

Like a good time to revise my daily rate then.

Oh my god.... (0)

Anonymous Coward | about 2 years ago | (#38433394)

A software update! What will we do? This is like y2k all over again!

Really?!?! *This* is a story? Slow news day?

I'm confused (2, Insightful)

broginator (1955750) | about 2 years ago | (#38433404)

"A federal payroll tax reduction" Is this a reduction of federal tax for all jobs, or a reduction of taxes for federal jobs?

On a separate note... (-1, Troll)

broginator (1955750) | about 2 years ago | (#38433462)

...fuck you /., my Karma is terrible for some stupid reason, so i start at -1? It's not like I'm trolling or flame-baiting, every one of my posts is on topic. So fuck you, that's what i have to say about that. I'll just start a new account. With blackjack, and hookers. In fact, forget the new account!

Re:On a separate note... (3, Funny)

mwvdlee (775178) | about 2 years ago | (#38433742)

...fuck you /., my Karma is terrible for some stupid reason, so i start at -1? It's not like I'm trolling or flame-baiting, every one of my posts is on topic. So fuck you, that's what i have to say about that. I'll just start a new account. With blackjack, and hookers. In fact, forget the new account!

Nope... not trolling or flame-baiting at all there.

Re:On a separate note... (0)

Anonymous Coward | about 2 years ago | (#38439904)

PROTIP: There is something called causality. Or "time".
So his current post can, by the laws of physics, not have an effect on his pre-posting karma.
For this post, his angriness is caused by his bad karma. Not the other way around.
His karma may or may not be caused by his previous trolling. But looking at /. in these past years, it's indeed more likely that the moderators were the trolls.
In any case, that is irrelevant to judging his current post. ... unless you employ dickish prejudice.

So this makes your comment a non-sequitur, and a typical example of somebody thinking he's smart, when he's actually very dumb. (Close to trolling.)

And yes, there are so few small-digit /. users, because they gave up. The fail, extremism, blindness to look around one's own socially conditioned whatever-colored glasses, and sometimes mind-boggling stupidity of whoever currently gets the moderation points, is just not worth it.
If at all, we post anonymously.

I, for one, changed my password by copying and pasting the output of /dev/random, changing my e-mail to something at mailinator.com, saving, and then logging out.

Re:On a separate note... (3, Informative)

icebraining (1313345) | about 2 years ago | (#38433900)

Actually they start at 0. And the "stupid reason" is simply because you don't seem to write informative, interesting or insightful posts, and funny doesn't give you karma.

Re:On a separate note... (-1, Offtopic)

mcgrew (92797) | about 2 years ago | (#38434180)

I just had a look at your comment history, and the only ones I would have modded up were modded funny, which is what I would have modded them. Funny gains no karma, and neither do one line comments that say nothing interesting, insightful, or informative; they'll likely be modded overrated or if they're the least bit incindiary, troll or flamebait.

Your karma is terrible because you've added nothing to any of the conversations. You'd probably be better off lurking. If you don't have anything to say, STFU. Say nothing and be thought a fool, speak and remove all doubt.

Since the "no karma bonus" button doesn't seem to be working, someone please mod me offtopic.

Re:I'm confused (1)

Attila Dimedici (1036002) | about 2 years ago | (#38433682)

It is a reduction of "federal payroll taxes". These are generally considered to be the items that appear on your paystub under FICA.

Re:I'm confused (1)

mcgrew (92797) | about 2 years ago | (#38433886)

Federal Payroll Taxes are Social Security and Medicare. With a few exceptions, everyone with a job pays them.

Software update? (3, Insightful)

Lumpy (12016) | about 2 years ago | (#38433498)

If your payroll software is that crappy that you have to update it for this change then please buy some real stuff. All you do is change the tax tables.

Honestly, what crap software out there requires a full software update to change tax tables?

Re:Software update? (2)

Maximum Prophet (716608) | about 2 years ago | (#38433648)

Right, plus I'm sure the tax software companies already have multiple tables drawn up, one for each proposal.

This is not a Y2K type issue. Unless Congress develops something truly weird, there will be no problem.

What might be a problem is if congress doesn't get it's rear in gear until March, then passes a retroactive tax cut.

For two months? (1)

JSBiff (87824) | about 2 years ago | (#38433734)

I wonder how many payroll systems out there were hard coded to the assumption that taxes only change on a year-to-year basis, not a month-to-month basis, so you can only load a tax table for a whole year, not a tax table for the next two months?

It may be that a software update will be necessary to change the code to add the ability to load a tax table for just one month, or a range of months, or an arbitrary range (e.g. 21st Jan to 15th April). I think if I were writing tax software, after what has happened the last couple months, I'd go for the last approach, since it seems like a law changing the taxes could go into effect at any time and last for any arbitrary duration of days.

Re:For two months? (4, Informative)

Attila Dimedici (1036002) | about 2 years ago | (#38434002)

Actually, I don't think that is it. My bet would be that most payroll systems are coded to assume that everyone who pays the payroll taxes (Social Security and Medicare) pay the same percentage up to the limit (you only pay these taxes up to a certain amount because you only collect based on income up to a certain amount). They are now introducing a system whereby those who earn less than a certain amount pay less than those who earn more than that (and the cutoff point is different from the amount which you don't pay this tax on the income above that amount--although you still pay for everything less than that amount that you earn).

Re:For two months? (4, Interesting)

emurphy42 (631808) | about 2 years ago | (#38435396)

This. More specifically, Googling (2012 Social Security tax cut) leads to http://www.foxnews.com/politics/2011/12/20/payroll-processors-say-two-month-fix-undoable/ [foxnews.com]

According to the proposed law, the two-month extension of a 4.2 percent taxable wage is applied only to the first $18,350 of income. Wages exceeding $18,350 paid during the first two months of 2012 would be subject to a 6.2 percent Social Security tax rate.

Yes, any decent payroll software has tax table updates, but they don't all support multi-tier rates like this. I consult on an accounting suite with a payroll module, and they had to release a full-on code patch this year to support a change in Connecticut that took effect in August, whereas they usually just release simple updates that save you the trouble of hand-entering all the new rates.

Re:For two months? (0)

Anonymous Coward | about 2 years ago | (#38437514)

Wait, what?

Feel free to flame me if I'm wrong....

We're talking about a 2% decrease in payroll under $18350 in the first two months of 2012, right? So, 0.02*18350/2 = $183.50 per month for two months, or a total savings per person of $367.

Can't we just add this to the tax refund in April? On a per person basis, this is paltry. Most people spent more than that between throwing elbows on Black Friday. This is what "we can't wait" for?

Re:For two months? (1)

emurphy42 (631808) | about 2 years ago | (#38440556)

As I understand it:

  • Rule #1 is the current system (6.2% on income up to $110,100)
  • Rule #2a is the Democrats' short-term goal and the primary subject of TFA (4.2% on income up to $18,350, 6.2% on remaining income up to $110,100, then revert to rule #1 after February)
  • Rule #2b is a hypothetical case (4.2% on income up to $110,100, then revert to rule #1 after February)
  • Rule #3 is the Democrats' long-term goal (4.2% on income up to $110,100, lasts through December)

Consider Alice (annual income $24K), Bob (annual income $72K), Charlie (annual income $120K), and Dave (annual income $1.2M):

  • Rule #1 - Alice pays $124/month, Bob pays $372/month; Charlie pays $620/month through November and $6.20 in December; Dave pays $6200 in January and $626.20 in February)
  • Rule #2a - Alice saves $40 + $40 = $80, Bob saves $120 + $120 = $240, Charlie saves $200 + $167 = $367, Dave saves $367 + $0 = $367
  • Rule #2b - Alice saves $40 + $40 = $80, Bob saves $120 + $120 = $240, Charlie saves $200 + $200 = $400, Dave saves $2000 + $202 = $2202
  • Rule #3 - Alice saves $40 * 12 = $480, Bob saves $120 * 12 = $1440, Charlie saves $200 * 11 + $2 = $2202, Dave saves $2000 + $202 = $2202

So the purpose of #2a is as a stepping stone to #3, and the purpose of #2a instead of #2b is a hedge in case they don't get #3; Dave doesn't get his bigger savings unless Alice also gets hers.

Re:For two months? (1)

matthewd (59896) | about 2 years ago | (#38440768)

No you can't do that, because then tax filers would need to be able to document what their income was during the first two months of the year. They couldn't file taxes until after February, the employer would have to issue a new form, the IRS would have to design the form, they'd have to redesign the 1040, et al. You realize all of this requires lead time, right?

Re:For two months? (1)

Slashdot Parent (995749) | about 2 years ago | (#38435540)

I would be shocked if any payroll software did anything other than arbitrary date ranges. There is just no way to predict what type of harebrained cockamamie scheme our legislature might devise.

I use QuickBooks for my business, and I can tell you that everything from tax tables to IRS mileage reimbursement rates to unemployment insurance rates are all specified as arbitrary effective dates.

Re:For two months? (1)

clintp (5169) | about 2 years ago | (#38439804)

I would be shocked if any payroll software did anything other than arbitrary date ranges. There is just no way to predict what type of harebrained cockamamie scheme our legislature might devise.

I work in payroll software and it's *far* more insane than this. This is just a timed rate change. When bigger stuff happens -- like the dual employer/employee federal withholding change last year or the COBRA credit the year before -- things get crazy.

When last-minute crap like that happens the *IRS* isn't even sure what to do. If a change gets passed, it will take a few days for the IRS to read the law and draft rules about how it'll work: the law is never specific enough and the IRS still needs to interpret it, develop reporting procedures, eligibility rules, etc.. For that entire time the major payroll vendors have frequent conference calls with the IRS for updates and questions so that they can change software to target what the rules will possibly be.

The programmers at payroll services are busy writing code against a spec that's still being written.

Re:For two months? (1)

matthewd (59896) | about 2 years ago | (#38440872)

Dive into Quickbooks then and see if you can get it to work. What you need to do is apply a 4.2% rate to wages under $18,350 in January and February, and a 6.2% rate that applies to wages over $18,350 but below $110,100 in January and February, and a 0% rate to wages above $110,100 in January and February. Then For March thru December, you need to specify a third rate, TBD, for wages under $110,100, 0% above that limit. The three paired amounts (wages paid and tax withheld for each category) then need to be reportable to fill out quarterly tax forms that have yet to be designed.

Re:Software update? (0)

Anonymous Coward | about 2 years ago | (#38433746)

I don't see why they don't make the that tax rate 0% for the whole year, that would make the tax tables really easy to program.

Re:Software update? (0)

Anonymous Coward | about 2 years ago | (#38433802)

Really, while not common, it's not uncommon.

Re:Software update? (4, Funny)

Kamiza Ikioi (893310) | about 2 years ago | (#38433818)

Honestly, what crap software out there requires a full software update to change tax tables?

Quicken 0.1a Private Garage Alpha "Cain" Edition running on 386 SX with DOS 5 known best for its 9/9/9 Sim City tax tables, no floating point operations, and inability to distinguish between charitable and political contributions.

Re:Software update? (1)

roman_mir (125474) | about 2 years ago | (#38437016)

By the way, his real tax was 9,9,9,9, the last 9 being the fact that corporations under his tax law wouldn't be able to write off their expenses, such as payroll against their revenues, but payroll taxes are not paid by corporations, it's paid by employees. Corporations really don't pay taxes. The 'corporate' income taxes are paid by shareholders/owners, the payroll tax is paid by employees, the sales taxes are paid by customers and personal income taxes are paid by employees (that's why Warren Buffet is full of shit, his real taxes are his corporate taxes, whatever they are, 30-35% and then 15% dividend tax, he owns 1/3 of the company's stock, so any tax against his corporation is tax against him).

Re:Software update? (3, Insightful)

Attila Dimedici (1036002) | about 2 years ago | (#38433824)

The problem is that it is only for two months and it is only for people who earn less than a certain amount. This is not income tax (which has varied according to how much you make since before computers were used to calculate payroll). This is for Social Security and Medicare taxes, which traditionally have been the same percentage for everyone up to a certain dollar amount of income (everything over that is not taxed). This only applies to people who make less than a certain amount. So, I suspect that, unlike income tax, this has traditionally been done by a straight percentage calculation (one that traditionally, also, automatically debited the same amount out of the the employer's payroll account without showing it on the paystub).

Re:Software update? (1)

ShakaUVM (157947) | about 2 years ago | (#38436790)

>>This is for Social Security and Medicare taxes

Even calling them "taxes" is a bit of a stretch.

Call them what they are - contributions to your future retirement - and suddenly the "tax cut" loses a lot of its support. It's all about how you frame a debate in politics...

Re:Software update? (0)

Anonymous Coward | about 2 years ago | (#38437840)

Social Security already cuts off around $105,000 income, so it is already a tiered tax. The proposal would just add another tier.
4.2% of the first $18,350
6.2% on income between $18,350 and ~$105,000
0% on all remaining income (all the way to Buffett-land) ... but only for two months, which is the biggest reason it's a stupid idea.

Re:Software update? (3, Insightful)

The Bastard (25271) | about 2 years ago | (#38434808)

Earlier in my career, I worked on a payroll system. It's not as straightforward as one might think, as payroll systems rarely are similar. In fact, the term "payroll" should really be replaced with "compensation", and "system" replaced with "rules engine system".

In a simple small business, compensation is probably pretty straightforward. Hourly employees, owner takes a salary. But what if an owner takes a draw against the the equity of the business?

Up the chain a bit, you now may have union dues to account for, bonuses, stock options instead of "cash", severance, and various other--often contractually obligated--quirks. Does health insurance count as compensation from the company? The smartphone with ultra data plan? The company car?

On the political side, what are the basic rules? What are the exemptions the politicians put in for their buddies?

There are a lot of little gotchas in "payroll" systems, and the use case testing needs to be spot on. Because no one wants their paycheck screwed up.

Re:Software update? (1)

roman_mir (125474) | about 2 years ago | (#38437094)

Of-course all of this should be eliminated and replaced with a consumption tax. Not only are the income taxes collected in a way that is illegal and unconstitutional, but they are also extremely harmful to the investment, as they reduce that investment while allowing the government to grow regardless of what people decide to spend, while the government is supposed to be a percentage of spending, not percentage of earnings.

All government services must be paid for, and if people don't have money to spend, those services need to be cut, and that's why taxing income, printing money and borrowing is a completely wrong way to subsidize government services. Government services are not investment, so they can't have a return so there is no real interest rate, and any amount of spending is a tax, because it has to be paid for eventually - either with a bigger tax (plus interest) or with weaker currency.

Side note: anybody who thinks that a weak currency is good for the country because of 'exports' is missing the point of trade in the first place. Trade is about trading benefits of labor between people, not trading benefits of labor of some people in exchange for worthless paper printed by others.

Re:Software update? (1)

mattack2 (1165421) | about 2 years ago | (#38440440)

Not only are the income taxes collected in a way that is illegal and unconstitutional

Then why don't you sue your state and the federal government, and take it all the way to the Supreme Court?

Re:Software update? (1)

bill_mcgonigle (4333) | about 2 years ago | (#38435348)

Honestly, what crap software out there requires a full software update to change tax tables?

They've fired everybody who understood payroll taxes and rely on the vendor to 'make it work'.

Re:Software update? (0)

Anonymous Coward | about 2 years ago | (#38437074)

Changing a few variables in a couple of lines of code is laughably easy, unfortunately it isn't where the problems lie. Large companies use payroll services to handle payments and the interactions between the parent company, the payroll provider and the government are the problem. Automatic billing systems that set a certain amount to payroll and a certain amount to taxes all need to be altered, and when you consider that many companies have several layers of subcontractors the complexity starts to get exponential. Then just for fun include things like SEC filings that require detailed information on finances, that maybe changing at the whim of congress who can't plan a year ahead and the situation is just stupid.
Finance is a bit more complicated than a couple of lines of code that spits out a check for you at the end of the month.

Anti-cyclic thinking (3, Interesting)

captainpanic (1173915) | about 2 years ago | (#38433580)

It's fine to do some anti-cyclic economy... and I understand the merits.

But wasn't it the idea that you reduce expenses in boon times, and go anti-cyclic, and thereby spend more in bad times?
But the last decade, the USA has clearly acted cyclic, not anti-cyclic. The US has spent money like its life depended on it (and many thought it really did, with terrorists lurking in every corner of the world, all aiming to bomb the US back into the Middle Ages).

It's surprising to see that there is even more money available... and it makes me wonder who will go down first in economic terms: the EU, or the USA.

Re:Anti-cyclic thinking (1)

ThinkWeak (958195) | about 2 years ago | (#38433838)

It's surprising to see that there is even more money available... and it makes me wonder who will go down first in economic terms: the EU, or the USA.

There isn't any real money available, we're just borrowing from the future. We're essentially breaking our system so bad that the standard of living in the US isn't going to improve for well over a decade.

Someone, somewhere has to to realize that we will have to pay all this back. Our taxes are going to go up and the longer we put it off, the worse it's going to be.

Re:Anti-cyclic thinking (0)

Anonymous Coward | about 2 years ago | (#38434310)

Wow, I don't think anyone ever realized that. You, sire, should be president.

Re:Anti-cyclic thinking (1)

geekoid (135745) | about 2 years ago | (#38435344)

"There isn't any real money available, we're just borrowing from the future"
That is completely false. You are a victim of republican FUD.

Re:Anti-cyclic thinking (0)

Anonymous Coward | about 2 years ago | (#38438780)

We spend more than we bring in and have for quite some time. How is that wrong?

Re:Anti-cyclic thinking (0)

Anonymous Coward | about 2 years ago | (#38440364)

Because once you acknowledge the facts, it becomes difficult to justify increased expenditures for all the programs that every person living in the United States is entitled to at birth.

Re:Anti-cyclic thinking (0)

Anonymous Coward | about 2 years ago | (#38433972)

Nobody really follows Keynes, they just use him for an excuse to keep on spending. The politicians vote buying never stops, because voters keep being bought.

But we're close to the point where most people figure out that the debts and promises are going to be defaulted on, either by inflation (in progress) or open default (several states are "altering the deal" with unsustainable public employee pensions).

Re:Anti-cyclic thinking (1)

DragonWriter (970822) | about 2 years ago | (#38436072)

But wasn't it the idea that you reduce expenses in boon times, and go anti-cyclic, and thereby spend more in bad times?

No. Its that you reduce deficits in boom times, which isn't the same thing as reducing expenses.

But the last decade, the USA has clearly acted cyclic, not anti-cyclic. The US has spent money like its life depended on it

The last decade hasn't been "boon times" or "boom times", its been fairly weak growth during the parts of it that weren't recessions, with even worse distributional effects everywhere but the top few percent than is typical given the growth rates. The last boom times in this country was the Clinton-era expansion when the federal deficit was completely eliminated and a surplus acheived, which is a fairly good example of counter-cyclical fiscal policy.

The problem is that for most of the last decade, the particular set of tax cuts and spending increases that were adopted were poorly directed at economic growth. This isn't a pro- or counter-cyclical fiscal policy issue on the big-picture level, its much more about the details of the particular spending and tax policies.

Change Management PITA (4, Informative)

Anonymous Coward | about 2 years ago | (#38433644)

As others have said, updating the rates in the tax tables is trivial. It actually takes us more time to go through change management process and get no less than 4 levels of approval to make the changes in the production payroll system.

What? (5, Funny)

lennier1 (264730) | about 2 years ago | (#38433812)

A bunch of idiots introduces the need for a change in the last minute? That's something I'm sure no developer would've expected.

Re:What? (1)

geekoid (135745) | about 2 years ago | (#38435366)

Last minute? If you work or are in charge of a payroll system, and this is last minute news for you, find a different job.

that's why I use a service (1)

Trailer Trash (60756) | about 2 years ago | (#38433868)

I use surepayroll, rebranded through my bank. I don't even think of this crap anymore, I just pay us and then do something I enjoy more.

This (1)

Anonymous Coward | about 2 years ago | (#38434056)

My accountant doesn't even manage his own office's payroll. They outsource to one of the many payroll processing companies. With criminal and civil liabilities you're so much better off paying the cost to outsource, it's really pretty cheap.

So Naive (0)

Anonymous Coward | about 2 years ago | (#38433902)

Payroll Taxes include Federal, State and Local. The includes many other Payroll deductions too. These change frequently. Quickbook Payroll pushes data and code updates for every payroll period. You can';t run a QB Payroll without the latest Payroll update. And most small business do Payrolls weekly and they don't screw it up, because they risk fines and penalties if they do.

Re:So Naive (1)

sclark46 (969374) | about 2 years ago | (#38434044)

This is a trivial change. It is only taking your gross pay time either 4.2% or 6.2% depending on whether they extend the tax break or not.

Don't blame the software, blame the government (2)

MikeRT (947531) | about 2 years ago | (#38434114)

At ~7m lines of legal language, the federal tax code is as large as many operating systems in complexity. Writing code that can correctly handle its business rules is probably as complex as many of the systems that Wall Street puts into place for real-time trading and risk analysis.

As a conservative, I hate to say Clinton was right, but Bill Clinton knocked it out of the park when he said we need to just lower rates and then wipe out most of the exemptions and credits. His only fault was not advocating the complete abolition of those things so the tax code would be predictable.

Re:Don't blame the software, blame the government (1)

Slavik81 (1457219) | more than 2 years ago | (#38442688)

This has been proposed a lot recently. It was the real hope for a grand bargin between Republicans and Democrats. However, the sticking point was whether the change would be revenue neutral. Republicans demanded it be dropped by at least as much as was saved, Democrats wanted to drop the tax rate by less than what would be saved in exemptions and credits.

in theory this is not a big deal (1)

a2wflc (705508) | about 2 years ago | (#38434204)

Modern tax apps have to deal with things like this. But "In theory there is no difference between theory and practice. In practice there is."

I'm sure my company and many others will be doing a test run before issuing 10s of thousands of checks and direct deposits.

I'd bet more than a few companies restore from backup and lose tax rate updates. Probably not big companies, but plenty of small ones where accounting and IT don't have their own "department" and don't have processes that drive everyone crazy most of the time but make sure this kind of thing doesn't happen.

That's Congress for you... (3, Insightful)

PortHaven (242123) | about 2 years ago | (#38434220)

"We never think before we act, and when we act, we act with politics in mind. Not intelligence in mind."

Progress - a forward or onward movement (as to an objective or to a goal) :

Congress - opposite of progress.

Not in Canada (0)

Anonymous Coward | about 2 years ago | (#38434842)

No. I'm in Canada.

Someone is surprised (1)

wagr (1070120) | about 2 years ago | (#38434864)

I am actually surprised this is newsworthy. This one is not a change at all.
We've been dealing with changes in taxation since we designed our first retail product in 1986. When we added employee time tracking and more tax reports, the number of tax rules multiplied by about 3. If congress doesn't pass an extension, then we post a small update notice and all our sites (in the US) will have it within a minute, or the next time they launch our software.
You want to talk newsworthy, convince all local governments to use the same tax rules, preferably the same tax rate. Then I wouldn't be spending my Decembers and Januaries rooting around bulletins, making tiny rate changes to our tables.
My family has learned to not bother inviting me home for the holidays.

The problem isn't the tax tables (2)

flux pinner (1170311) | about 2 years ago | (#38434946)

...the problem is that many companies/institutions close the pay period and issue pay stubs well in advance of the pay date. For example, I'm paid on the 1st of the month, but my January 1 pay check is for a pay period that ends December 22 (this Thursday), and by the evening of December 23 I will have an electronic pay stub waiting for me that shows my Social Security deduction for January 1. If Congress extends the tax holiday on, say, December 27, that doesn't leave much time to update the system, re-issue all the pay stubs, and change all the direct deposit information with the banks. Not impossible, but not a real friendly after-Christmas gift to throw to all the HR departments all across the country. And it's no way to run the world's largest economy.

Re:The problem isn't the tax tables (1)

tokul (682258) | about 2 years ago | (#38437754)

And it's no way to run the world's largest economy.

I can assure you that IRS does not run European Union economy.

more October filings for IRS (3, Interesting)

peter303 (12292) | about 2 years ago | (#38435216)

The December 2010 tax changes meant several official IRS forms were not available until February or even March. A lot of this had to do with basis information now mandated on brokerage 1099s. So the old habit of filing in early February for anticipated refund becomes less possible. Even April filing is threatened by lack of forms and data. More people get the automatic October extension tax-preparers tell me.

Re:more October filings for IRS (1)

tepples (727027) | about 2 years ago | (#38436052)

So the old habit of filing in early February for anticipated refund becomes less possible.

Furthermore, if you are in college or have a kid in college, the habit of filing in February to be able to file a FAFSA by March 1 becomes less possible.

I Hope They Don't Extend It (2)

Slashdot Parent (995749) | about 2 years ago | (#38435386)

I really wish that they would not extend the payroll tax cut. Not that I'm itching to pay more taxes or anything, but are we giving up all pretense that Social Security is an earned benefit?

Re:I Hope They Don't Extend It (1)

DragonWriter (970822) | about 2 years ago | (#38435962)

I really wish that they would not extend the payroll tax cut. Not that I'm itching to pay more taxes or anything, but are we giving up all pretense that Social Security is an earned benefit?

Its earned by work. The only thing reducing (or even outright eliminating) the payroll tax would give up pretense of is that it is a purchased personal asset rather than an earned benefit.

Re:I Hope They Don't Extend It (1)

Toonol (1057698) | about 2 years ago | (#38437340)

but are we giving up all pretense that Social Security is an earned benefit?

Losing that pretense might be a good thing; sometimes we need a rude awakening. The myth that each person has a 'social security savings account' somewhere has led to a lot of bad decisions. For better or worse, social security is an entitlement program, paid for out of current taxation and borrowing.

Re:I Hope They Don't Extend It (1)

Slashdot Parent (995749) | about 2 years ago | (#38437672)

Losing that pretense might be a good thing; sometimes we need a rude awakening. The myth that each person has a 'social security savings account' somewhere has led to a lot of bad decisions. For better or worse, social security is an entitlement program, paid for out of current taxation and borrowing.

Everybody knows that it's a pay-as-you-go system. People don't believe that they have an "account" in the "bank account" sense of the word. But the idea is that you contribute to it now, and you take from it when you're an old fogie. It's more like a pension than a brokerage account.

Problem is that now the government is saying you don't really have to contribute at the full level to get full benefits. I think this sets a terrible precedent. All of us who are paying at this lower rate should have our benefits reduced as a result. Again, not itching to get dinged when I retire, but people need to understand that there are costs to profligacy.

Re:I Hope They Don't Extend It (1)

mattack2 (1165421) | about 2 years ago | (#38440584)

All of us who are paying at this lower rate should have our benefits reduced as a result.

So this would allow me to pay 0% and forgo all Social Security payments in the future, right?

I have a 401k. I don't want/need to pay for Social Security (i.e. the government mandated Ponzi scheme)

If it *were* an individual account (a "forced" 401k, so I don't have to pay for idiots who were too stupid to save), I would be far less against it.

Re:I Hope They Don't Extend It (1)

Slashdot Parent (995749) | about 2 years ago | (#38440894)

All of us who are paying at this lower rate should have our benefits reduced as a result.

So this would allow me to pay 0% and forgo all Social Security payments in the future, right?

Personally, I would love this option, but it is unfortunately not available. If I were king of the country, I'd let you opt out. :P

Summary is badly confused (1)

DragonWriter (970822) | about 2 years ago | (#38435884)

A federal payroll tax reduction for two months is being pushed by the President.

No, its not.

A continuation of the current federal payroll tax "holiday" for a full year is being pushed by the President. Congress has a broad bipartisan agreement with this goal, but hasn't been able to agree on how to pay for it (Republicans want program cuts, Democrats what tax increases on the wealthy), and the compromise adopted in the Senate has been for a two-month extension to provide time for negotiations on a long-term solution.

Paying less money to the government seems good

Its actually between "paying the same money to the government as currently" (if the measure passes) and "paying more money to the government" (if it fails), paying less money isn't on the table.

but if the law is changed it will change the payroll taxes in January and February.

No, if the law is not changed, payroll tax rates will change in January. If the law is changed, payroll tax rates will remain the same in January as they are now.

Many of us can well imagine what that will do to the many payroll systems which are already programmed with the 2012 tax rates.

It will require them to be updated to reflect the same rates that the same systems applied for all of 2011, which -- even if the rates are hardcoded such that it requires a new build and code deployment -- should be fairly trivial. Since tax rate changes are a fairly regular occurrence, presumably on even moderately well-designed payroll systems this won't involve a code change at all, just a configuration change, table update, or something similar.

Re:Summary is badly confused (0)

Anonymous Coward | about 2 years ago | (#38436206)

Thank you. I was hoping that the summary or article was just badly worded. Because I was thinking, if the tax rates change midyear, that's going to change nearly everything. W-2 forms are going to need to be changed to divide up your income into "income earned in Jan-Feb" and "income earned the rest of the year". Same thing with your 1098 to show when you paid interest on your mortgage, your 1099-INT showing when you earned income in your bank, all of the self-employment stuff to divide up when you earned income and when you made expenses in your business, etc. Essentially, it would be almost like having to do 2 separate tax returns in the same year. It would be a nightmare.

This isn't a tax cut! (1)

Anonymous Coward | about 2 years ago | (#38436184)

Stop calling it a tax cut! What they are doing to us has absolutely nothing to do with your actual tax burden. The plan is to just take less out of your paycheck, hence the name: payroll tax reduction. Then, in April 2012, most people will suddenly discover not enough money was withheld to cover their tax bill and they have to come up with cash to pay it. There is a HUGE difference between tax load and payroll deductions.

Stupid article (1)

DogDude (805747) | about 2 years ago | (#38436414)

This is a really, truly, stupid article. $300 off-the-shelf Quickbooks, which 90% of all US small businesses use, has been handling this kind of stuff for at least a decade, if not two.

In other news, I heard that a bug has been found in Windows! How is this going to be addressed? Is Microsoft going to have to send new CD's to everybody on the planet, and everybody will have to re-write all of their Word documents?!?

To the clueless: tax tables change constantly, and are updated via the Net every time "Pay Employees" is clicked.

This would be a good job for a virus writer (0)

Anonymous Coward | about 2 years ago | (#38441468)

He could unleash his worm on Dec 31,2011 and then have it automatically die on March 1st, 2012.

Two month tax break, what a bunch of Lusers!

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