Welcome to our annual payroll newsletter for 1999, where we try to give you the highlights of the payroll tax changes affecting you, as an employer, and your employees. We summarize them as follows: Overview Forms Federal Deposit Requirements California Deposit Requirements Self-Employment Household Employees (Federal) Household Employees (State) Overview FICA/Medicare The total Social Security tax rate, each, for both the employee and employer remains at 7.65%. The maximum amount of earnings in a year which count for the FICA portion of the Social Security tax will be $72,600 - up from $68,400 in 1998. The maximum FICA portion of the Social Security tax is 6.2% of $72,600 or $4,501.20, each, for both the employee and employer. Remember: all wages are subject to the 1.45% Medicare portion of the Social Security tax. The rate for those who are self-employed is 15.30% through $72,600 and drops to 2.9% for all earnings above $72,600. Federal Unemployment Tax Act (FUTA) This is an employer-only tax, paid quarterly. The rate to use in determining your deposit is .8% of the first $7,000 of an employee's earnings. The maximum per each of your California employees is $56. The wages of your non-California employees may be subject to a tax rate up to 6.2%. This did not change from 1998 to 1999. Federal Withholding Tax and California Withholding Tax Continue to use tax guides provided by the federal and state governments. State Disability Insurance (SDI) The maximum amount of earnings which count for State Disability Insurance remains at $31,767 in 1999. The SDI rate remains at 0.5% of the first $31,767 of an employee's earnings to a maximum of $158.84. There is no change from 1998 to 1999. State Unemployment Insurance (SUI) This is an employer-only tax, paid quarterly. The State should notify you, by mail, before the end of January, as to what your experience tax rate will be for 1999. The State is also sending out information on how you can voluntarily lower your SUI tax rate by paying various amounts. In general, we do not recommend this option, but if you are interested in it, please contact us. State Employment Training Tax (ETT) This is an employer-only tax, paid quarterly. The ETT rate is 0.1% of the first $7,000 of an employeeís earnings in 1999, for a maximum of $7 per employee.