I guess I can understand that a company would need to hire IT folks to make this change in their internal AR/AP system.
I would assume SAP, Oracle, etc., would do this automatically for their private and gov’t customers.
The biggest issue that I see is for a government entity (i.e. local, city, state and fed) to change their payment system to withhold the additional 3%?
The other big issue would be subcontractors? There appears to be disagreement if this applies to subs and the conflict with the prompt payment act?
Not sure but will look into. Thanks for the post.
Subs are exempt from withholding.
From the accounting end, it's going to be a major pain, as the regs call for a two-year lookback period to determine which payments the agency will need to withhold.
BTW, that two-year contract (from a different employer) is looking really good at this point. Not that I don't like a challenge, but these new regs are just other obstacles for companies to navigate.