By: Mark Ward | Payroll Experts, Inc
To ensure a smooth transition into the new year here are some reminders about our quarter/year end procedures. Please report all 4th Quarter 2014 payroll changes/adjustments by Tuesday, December 30th or before you process a payroll with a January 2015 check date, whichever comes first. Changes or adjustments reported after this date will require a reopening of your prior quarter payroll files along with the reprocessing of your tax returns. The minimum charge to reopen, reprocess, amend any tax filings is $150. If the changes incur additional tax liability you will be responsible for all penalties and interest along with the tax liability. Following are several types of quarter/year-end adjustments but one in particular always gets many businesses. Businesses which are S Corps and pay insurance premiums for owners need to report to us the insurance premium amount paid in 2014. This amount has to be reported on your W-2. If you don’t get this to us now your accountant will want you to go to the expense of having us amend your W-2. Please check with your accountants and report this information to us by December 30th.
Payroll Adjustments may include but aren’t limited to:
- Void Checks
- Manual checks
- 3rd Party Sick Pay
- Fringe Benefits: Some examples of fringe benefits are automobile use, travel, discounts on services, memberships, tickets, etc.
- Group Term Life: Premiums paid by employer for coverage in excess of $50,000.
- Sub-S Health Insurance: S Corporation health insurance premiums for owners that is paid by the corporation.
- Employer Health Care Cost (http://www.irs.gov/uac/Form-W-2-Reporting-of-Employer-Sponsored-Health-Coverage)
- Employer contributions to employee Health Savings Accounts (HSA)
Missing Information: Missing information can cause delays to the filing of your tax returns and will incur additional processing costs as well as potential tax penalties. Following are common items that may be missing and will cause a delay in your tax filings:
Employee Information: Common items that we may be missing for employees are social security numbers or addresses (please remember valid ssn’s do not start with a “9”). We provide you with a report every payroll detailing the missing employee information. This information is found on the “Missing New Hire Information Report.” This missing information causes our tax filings to reject and requires manual processing and may cause the new hire reports along with your tax returns to be late. Please report all missing employee information to your payroll specialist no later than Tuesday, December 30th. The charge for missing employee information (active or inactive employees) that delays tax processing is $50.
Company Information: Common items that we may be missing for your company is state withholding and/or State Unemployment ID numbers and rates. This missing information causes our tax filings to reject and requires manual processing. The processing charge for each missing Tax ID Number is $100. Please report all missing withholding and State Unemployment ID numbers to your payroll specialist no later than Tuesday, December 30th.
Tax Notices: In November and December the IRS and State Tax agencies will be mailing deposit frequency changes and/or rate changes for this next year. If you receive one of these notices please send/fax us a copy so we can apply the correct tax rate.
Bring on the New Year – We Are Ready! Working together we will have a successful year-end. Early morning January 2nd, we will start preparing and filing the many different required payroll tax returns with the appropriate tax agencies. Our goal is to have your W-2’s printed and ready for pickup/delivery by January 20th. You will then need to distribute or mail all W-2’s to employees by January 31st. We are passionate about keeping you compliant and love being your payroll partner. Thank you!