Businesses and other employers in Chester County, who appeared to be in a no-win situation earlier this month, have gotten a reprieve from the Tax Man.
While all Pennsylvania counties will change how they collect local earned-income tax in 2012, Chester County has pushed to be an early adopter, making the changes effective Jan. 1, 2011.
The problem is that the official state forms that employers needed to provide to their workers in order to document the correct withholding weren’t ready. Sounds like just a paperwork shuffle, right?
Yes, except several accountants I’d talked with said that Act 32, which is expected to simplify how the local earned-income tax is collected, carries with it penalties for noncompliance, including a fine of up to $25,000 and/or up to two years in prison.
According to the Pennsylvania Institute of Certified Public Accountants, the Chester Tax Collection Committee now has agreed to waive all penalties and interest for the first two quarters of 2011.
That’s good, because accountants say their clients are largely unaware of the shift that requires employers to withhold taxes at the higher rate of either the nonresident rate in the municipality where the employer is based, or where the employee lives.
This reprieve will give them more time to clue clients in and for payroll companies to adjust. Besides, how fair would it be to penalize a business when official state forms weren’t available? Fortunately, we probably won’t have to find out.
If you haven’t had your fill of events forecasting the economic outlook for 2011, two more are scheduled Tuesday.
First up is the Rutgers Quarterly Business Outlook, from 8 to 9:30 a.m at the Crowne Plaza, 2349 W. Marlton Pike, Cherry Hill.
A banker, a hospital administrator, and banking regulator will discuss employment and the South Jersey economy: Joseph Lizza, president and CEO of Susquehanna Bank; Martin Bieber, president and CEO of Kennedy Health System; and Herb Taylor, vice president of the Federal Reserve Bank of Philadelphia.
The Rutgers event is open to the public and is free of charge.
The second outlook will be provided by the man who runs Lehman Bros. Holdings Inc. Yes, Lehman may have collapsed in September 2008, but that doesn’t mean it’s gone.
Lehman lives on in bankruptcy court as its current CEO tries to unwind the tangled mess left by what once was one of the nation’s largest investment-banking firms.
Bryan Marsal, who is also a founder and co-CEO of Alvarez & Marsal, a New York-based turnaround firm, will be the featured speaker at La Salle University’s 10th annual Economic Outlook Forum at noon at the Union League of Philadelphia, 140 S. Broad St.
This event is also open to the public, but it’s not free. Tickets are $55 per person.
My question is: If someone who works with broken companies has a positive outlook for 2011, isn’t that bad for the rest of us?