2011 Tax Changes Memo by ashrafp


Creating a World Class Education
Beverly Hills
Unified School District

To:      All BHUSD Employees

From: Alex Cherniss, Ed.D., Assistant Superintendent Business Services and
      Mary Anne McCabe, Executive Director, Budget and Food Services

Re:      Year 2011 Income Tax changes and Withholding Information
         Effective January 1, 2011

Happy New Year! We wanted to take a moment and update you on tax changes that may affect your
paychecks for the 2011 calendar year.

Federal and State Income Tax Withholding: The annual federal withholding allowance for one allowance
is $3,700 for the 2011 calendar year. The federal and state income tax withholding brackets have been revised
for 2011.

Employee social Security/OASDI and Medicare: The year 2011 Social Security/OASDI tax rate for
employees has been changed from 6.2 percent to 4.2 percent. The Medicare tax rate remains at 1.45 percent.
The Social Security/OASDI maximum wage base remains at $106,800 for 2011. There is no cap on the
Medicare wage base.

Federal Withholding – Form W-4: you must file a new or amended Form W-4, “Employee’s Withholding
Allowance Certificate,” if your filing status, exemption allowances or exempt status has changed since your
last W-4 was filed. If you claimed exemption from withholding tax on your year 2010 Form W-4, you must
file a new W-4 for year 2011 no later than February 16, 2011, if you want to continue to claim the exemption
in 2011. If you no longer claim exempt status, you must file a new W-4 for January tax withholding no later
than January 14, 2011.

Unless you file a state Form DE-4, state tax withholding is based on your federal W-4. you may elect to have
different federal and state exemption levels or claim state personal estimated withholding allowances by filing
both forms.

Advanced Earned income Credit (AEIC): Based on recent changes to the tax law, the Advance Earned
income Credit has been eliminated, and Form W-5 discontinued, effective January 1, 2011. eligible employees
may continue to file for earned income credit when they complete their annual tax return. Information for
claiming the credit is available in IRS Notice 797, at www.irs.gov.

We have attempted to provide information in compliance with the requirements of the Internal Revenue
System. Should you have questions regarding this information, please contact your tax person for tax advice.
Contact the payroll office if you need assistance with obtaining copies of forms to complete. We will also post
the forms on our web page.

                                                   BUSINESS OFFICE
                                                   Payroll Department
                                                 255 South Lasky Drive
                                              Beverly Hills, Ca 90212-3697
                                                V (310) 551-5100 x 2270
                                                    F (310) 556-4319

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