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May 2025 Compliance Updates: New State Taxes & Minimum Wage Changes

May 28, 2025 10:29:51 AM



New Tax Updates

Maryland - Paid Family Leave

DELAYED: contributions have been delayed until January 1, 2027 with benefits to begin January 1, 2028. This was confirmed through an agency newsletter received 4/08/2025 that confirmed the final bill passed to delay the start of this tax.

Paid Family and Medical Leave

 

State Updates

Minimum Wage Changes

Effective July 1, 2025

Alaska - $13.00
California

  • Pasadena - $18.04
  • Milpitas - $18.20
Oregon - $15.05

Alaska

Mandated Paid Sick Leave Policy – effective July 1. 2025

Employers in Alaska are required to provide paid sick leave for injury, illness, or family care. Employees are to accrue one hour of sick time for every 30 hours worked. This accrual rate ratio applies regardless of whether the employee works regular or overtime hours, hours at different rates, or hours across multiple pay periods. Salary employees exempt from overtime are only required to be credited up to 40 hours of work per leave for the accrual ratio. Therefore, the accrual ratio would only apply to the first 40 hours that a salary-exempt employee works in a work week.

Employers with 15 or more employees are required to provide up to 56 hours of sick time per year. Employers with 14 or less employees are required to provide up to 40 hours of sick time per year.

Under this law, employees can carry a sick leave balance from one year into the next. There is no maximum carryover; their sick leave balance can exceed the accrual and usage rate limit. Employees can cash out unused accrued time at the end of the year, but this cannot be mandated. Employees must be able to carry over unused time.

Employees that are rehired within six months of ending initial employment must have their accrued sick time reinstated.

Employees in Alaska can use paid sick leave for the following reasons:

  • Injury
  • Illness
  • Care for a family member
  • Receive care or legal help related to domestic violence, sexual assault, or stalking

If the employee is out for more than three consecutive workdays, the employer can ask for a signed note from a healthcare professional. However, the employer may not ask the employee for details.

Employers must inform their employees of the required sick leave policy and begin setting the accrual limits to track earned and used sick leave time.

Ballot Measure 1 FAQ

Idaho

Updated withholding method – retroactive to January 1, 2025 -- **System updates already in place

On April 28, 2025 Idaho released the 2025 withholding tables for the 2025 tax year. The flat tax rate has been decreased to 5.3%. The state allowance has been increased to $3,868 annually (previously $3,600). The amount of tax-free income used in the percentage method increased to $30,000 for married employees and $15,000 for single employees (up from $29,200 and $14,600 in 2024).

The tax tables in ProLiant’s system has been updated with this information.

Missouri

Mandated Paid Sick Leave Policy – effective May 1, 2025

Employers in Missouri must provide earned paid sick time to eligible employees, regardless of the number of active employees. Employees are to accrue one hour of sick time for every 30 hours worked. Employees are to begin accruing paid sick time as of May 1st, 2025. Employees are entitled up to 80 unused hours of earned paid sick time carried over to the next 12-month period. Alternatively, an employer may pay out up to 80 unused hours of an employee’s accrued earned paid sick time at the end of each 12-month period and provide the employee with an amount of earned paid sick time that meets the requirements of the law available for the employee’s immediate use at the beginning of the subsequent year. Only hours worked in Missouri accrue earned paid sick time. Section 290.600 defines "employee" under the paid sick time law is "any individual employed in this state by an employer".

An employee can use their "earned paid sick time" for the following reasons:

  • They or a family member have a mental or physical illness, injury, or health condition.
  • They or a family member require medical care, a medical diagnosis, or treatment, as well as receiving preventative medical care services.
  • Their place of employment has been ordered closed by a public official due to a public health emergency.
  • They need to care for a child whose school district has been ordered closed by a public official due to a public health emergency.
  • They need to be absent to attend to matters relating to domestic violence, sexual assault, or stalking

Records relating to earned and used sick time must be maintained by the employer for a minimum of three years.

Proposition A - Paid Sick Time Benefits | Missouri Department of Labor and Industrial Relations

Missouri Revisor of Statutes - Revised Statutes of Missouri, RSMo Chapter 290

Utah

Updated withholding method – effective June 1, 2025

Utah updated its withholding guide, decreasing the income tax rate to 4.5% from 4.55%, effective June 1, 2025.

The base allowance used in the formulas increased to $450 for single employees and $900 for married employees (up from $440 and $880).

The exemptions from wages in the formulas increased to $9,107 for single employees and $18,213 for married employees (up from $8,826 and $17,652).

These updates will be active in ProLiant’s system as of the June 1st effective date.                                                                                                                      \

Publication 14 Withholding Tax Guide