Health & Fitness
Tips for Payroll Processors Preparing for Year-End
Payroll Processors -- NOW is the time to start preparing for year-end! Here are some tips for what is to come after quarterlies have been sent!
Levi G. Meeske, CPP, offers his tips on preparing for year-end in the October issue of PAYTECH magazine. Since this is the month that quarterlies are being mailed out, I figured this is the best time to share his advice for what’s to come next.
Ideally, the best time to begin preparing for year-end is right after the last one is over – get a head start! Comparing each payroll balances with quarterly balances early on will enable you to find and correct any errors.
It is also good to regularly compare the social security number and names in your system with the Social Security Administration. Again, preparing early on will allow for errors to be caught and corrected sooner.
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Comparing information with your accounting partners will also make for a smoother year-end process, as they may have additional and valuable information to include on W-2s. You may discover items such as gift cards or other payments to the employee that must be reported as income.
Another tip is for payroll processors to always double check the calculations in each box of the W-2s. Even though this information is calculated by a computer system, it is still encouraged to verify the numbers.
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The next step is to plan next year’s payroll calendar so deadlines can be met. Pay attention to the dates of federal holidays, bank holidays, and holidays when your office is closed. Update your system with new-year premiums if needed and be aware of how many pay periods are in the new year. There may be a difference in benefit deductions withheld at the end of the year.
Be aware of any new forms and publications from the IRS and have employees evaluate their W-4s at the beginning of the new year in case they have had any major life event changes in the past year. Also, pay attention to any changes in FICA rates and wage bases, new information to report on W-2s and review all the minimum wages in your system for possible new rates.
After the last payrolls of the year have been processed, but before you begin the first payroll of the new year, verify that all balances have been submitted, charitable deductions have been paid, exception time has been reset, but wages, accumulations, and goals remain intact. Finally, determine how many W-2s your office will be mailing out to complete the year-end process.
