With tax season just around the corner, small businesses need to make sure that all of their payroll and benefits information is organized and properly and that finances are in order. In order to do that, you might want to develop and be sure to follow a comprehensive payroll processing checklist that will account for every bit of information needed to complete tax filings properly. There might not be one list that accounts for every payroll program, but there are a handful of things that should be included in the majority of them.
Make Sure Employee Contact Info is Current
This is often the first item on a payroll processing checklist because without updating that info, it might be impossible to get W-2s and other forms to employees. This might take a while and it might be the responsibility of the employees, but just sending out an email reminder to update information could be sufficient.
Determine W-2 Reprint Procedures
Some businesses will charge a fee if employees lose their W-2s since reprinting them can be a hassle. Before doing so, it is always smart for owners and managers to come up with a plan in case that happens. If the forms are accessible online, again, an email reminder or memo with the required information will often be enough.
Collect Adjustment Information
This step tends to be one of the more complicated on payroll processing checklists for businesses getting ready for tax season, but it is quite important. The two most common adjustments are for non-cash benefits like the use of a company car and group term life insurance paid by employers. Taking the time to get some help is wise for any business owner who doesn’t want to make a preventable tax mistake.
Don’t Forget Freelancers!
Most employees need W-2 forms, but freelancers or self-employed contractors might also need a 1099 to file their own taxes. This is an important responsibility for owners who want to maintain a strong company reputation that won’t scare away potential workers in the future. Simply remember to generate and send out 1099s without being contacted will always help workers who don’t have full-time status.
There are a number of other tasks that will also need to be completed during tax season, and skipping just one of them could prove to be a costly mistake. Tasks like writing down and following due dates, archiving payroll files, and using the proper reporting programs are all important to business owners who do not want to get in trouble with the IRS. Keeping them in mind all year is smart, but they can be particularly vital with tax season approaching. To learn more, read this: www.ioipay.com