Mergers & Acquisitions: Employment Tax Reporting for Compliance & Tax Savings

Employers are charged with a range of employment tax reporting responsibilities related to merger and acquisition (M&A) activity or other transactional event (consolidation, restructure, etc. ). These responsibilities are often attached to significant penalties if they are neglected, particularly in the wake of SUTA Dumping legislation. However, compliance is not the only issue of interest for employers who have experienced M&A - there are also a range of rights associated with M&A, which open the possibility for material savings opportunities. For a variety of reasons, including the complexity of these transactions and the tendency for employment tax issues to slip between the cracks during the limited time window during a transaction, employers are often leaving money sitting unclaimed following M&A activity.

This presentation is going to overview the current poor health of the employment tax system, and how this is impacting the agencies processing and audit of M&A events. We are also going to talk about “Section 252” UI Integrity legislation included in the Tax Adjustment Assistance Extension Act of 2011 (TAAEA), and how it will affect employers and hopefully restore health (and lower tax rates) to the SUI systems. Then we will give attention to the SUTA Dumping Prevention Act and the QETP “Questionable Employment Tax Practices” initiative.

Following that, we will get into the nuts and bolts of required employment tax reporting for M&A, including change of control, successor determination, and transfer of UI experience. These items are critical not only to stay compliant, but also to hopefully reduce an employer’s tax burden. Other items we will cover include wage-base carryforward, the statute of limitations on prior M&A, tax account evaluations, and the benefits of conducting a retrospective review on prior transactions.

In closing, we will consider advance planning for future transactions, including timing, which details to request of prospects, and negotiating payroll transitions. Case studies of leading employers will be provided to get an idea of representative savings.

NOTE: *Participate in the Q&A session and be entered in a raffle to win a Microsoft Surface Tablet on behalf of Ross Henderson and        Employment Tax Specialists!

HR, Payroll

• Current health of US Employment Tax system
• New UI Integrity Rules
• Key Compliance & Audit
• SUTA Dumping Prevention Act
• QETP “Questionable Employment Tax Practices”
• Essential Employment Tax Reporting for M&A
• Change of Control
• New Owner / Officer
• Successor Determination
• Transfer of UI Experience
• Treatment of Taxable Wages
• Wage Base Carryforward
• Target company
• Account closures
• Tax Account evaluation for good standing
• Prior M&A
• Statute of Limitations
• Retro review & refund recovery
• New Transaction planning
• Detail requests
• Timing
• Payroll transition

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