Small Business Year End Payroll Checklist
2018 is almost here. Soon, employers and human resources departments across the country will hear the question, "when do we get w2s?" repeatedly. It's time to dot those Is and cross those Ts. Here is a useful checklist to help you have a smooth year end to 2017. By the way, if you use an outside payroll company or accountant, you should make sure they can answer these questions or do these tasks for you too.
1. Remember your W3 form (or the data that makes up your electronic filing) must add up to the sum of the data you filed on your quarterly 941 forms. I recommend that you start with a spread sheet and balance your 941 forms to your payroll register and to your W3. Remember, most employers, even small ones, don't file W3's if they file W2s electronically, and almost everyone does now. But, it is a useful form to generate yourself for balance purposes, even if you don't actually file it.
2. Remember gross payroll is not going to equal your box 1 wages on your w2 or w3 if you have any pretax deductions. You report the amount of money that remains after taxes.
3. Make sure you have accounted for the value of life insurance policies over 50,000.00 in benefit for such policies you offer/pay for your employees.
4. Do not include reimbursements in wages, but do include allowances such as monthly auto allowances, phone allowances, and clothing allowances. If you reimburse employees for business expenses such as mileage or office supplies, that money is not income to the employee. It is a good time to make sure you did not deduct for things you should not have deducted for. For example, you can almost never take any deduction from an employee who makes minimum wage. For restaurants who pay 2.13 per hour to servers, you should not have deductions for uniforms, shortages etc.
5. Be sure you have paid your quarterly 940 taxes and be sure you file your annual 940 return for Federal Unemployment Taxes. Be sure you have paid taxes at the right rate based on the state where you have employees. You will need to gather your SUTA returns and report the total paid for SUTA as well.
6. Have employees verify their social security numbers are correct before you file the w2s with the Social Security Department. It is also a good idea to send emails to past employees who left employment during the year to make sure they check their social security numbers and provide you with a correct address to mail their w2s.
7. Lastly, be sure you speak to your benefits broker and accountant to determine if you need to file a 5500 for you benefits plans. Make sure you have made all employee contributions to retirement plans such as 401(k) plans and get advice on paying the penalty and excise tax if you have not.
For help with your particular issues, remember the Law Firm of Joseph LaFleur PLLC is here to help. We wish you a joyful holiday season and a wonderful new year.