The year-end is almost here which means it’s time to start preparing for 2022! As a small business owner, there are several important year-end payroll tasks you will need to complete. While payroll mistakes can often be fixed, doing so can quickly become time-consuming and expensive. This is why it’s best to get it right the first time around!
123PayStubs is here to help you stay on top of all your year-end payroll responsibilities. Here are some important tasks you should add to your year-end payroll checklist:
Confirm Employee Information
Before the year-end, it’s important that you review your employee information and ensure all of it is up-to-date. You should confirm information such as your employee’s full legal name, SSN or EIN, marital status, and current address are accurate. This will make your year-end reporting much easier! While you must ensure your employee information is accurate, 123PayStubs will handle all of your tax calculations for you.
Payroll involves lots of calculations which unfortunately means there are lots of opportunities for errors. When you create pay stubs and e-file tax forms with 123PayStubs, your calculations will be handled for you automatically. The automatic calculations eliminate human error which will save you time and stress knowing that your information is accurate.
Don’t Forget About Bank Holidays
Throughout the year, there are numerous holidays that have an impact on payroll. As the year, comes to a close, it is especially important to take into consideration bank holidays when you are dating final checks for the year. You should spend some time reviewing your pay schedule to see if any paychecks will be affected by a bank holiday. It’s important to be proactive in situations such as this so that you can avoid a future issue.
If you pay employees via direct deposit, and payday falls on a bank holiday, employees will not get paid that day. In order to avoid a situation such as this, you should plan accordingly in order to ensure your employees get paid before the holiday. If it is too late to do, notify your employees immediately and inform them that they will be receiving their paycheck at a later date.
Make Sure You Record ALL Paychecks
Did you pay anything to employees outside of your regular payroll? If so, you need to ensure that your records reflect these payments. All of the paychecks you’re issued throughout the year need to be accounted for. It’s important to take into consideration any voided paychecks you had throughout the year.
If you hand-wrote a check to any employees or contractors during the year, the wages and taxes must be entered in the payroll system to ensure their W2/1099s are correct.
At the year-end, you will need to process your year-end reports. If you have one or more full-time employees and you’re paying them wages regularly and withheld taxes from their paychecks, you must file Form W-2 for them. Also, if you have independent contractors working for you and you have paid more than $600 as wages, you have to file Form 1099 for them. You will also need to furnish copies of Form W-2 for your employees and provide your contractors with copies of their 1099.
123PayStubs makes filing Form W-2/1099-NEC/1099-MISC quick and easy! Once your return is submitted and processed, you’ll receive the status of your return by email. We will send copies of Form W-2/1099 to your employees and contractors on your behalf. Our system will also validate your tax returns based on IRS business rules to reduce the chances of a form rejection.
Deposit and Report Taxes
Another part of the year-end payroll process is to report your FICA taxes. Employers have to file Form 941, to report income taxes, Social Security tax, or Medicare tax withheld from employees’ paychecks. As well as report their own portion of Social Security and Medicare tax. Form 941 is filed on a quarterly basis and it’s crucial that you file on time to avoid penalties from the IRS.
The third quarter filing deadline for Form 941 is November 01, 2021. You should begin preparing for this deadline and getting the information you will need readily available. With 123PayStubs, you can e-file IRS Form 941 quickly and securely. You can take advantage of 123PayStibs accurate calculations, built-in error check, and filing status updates. Start filing now!
The year-end is a hectic time with payroll and taxes. From final deadlines to preparing for the new year, it could be very easy for a mistake to hit your books. Luckily, with 123PayStubs by your side, your year-end will be stress-free and you’ll be entering 2022 on a positive note. 123PayStubs will help you meet all of your payroll requirements including generating accurate pay stubs and handling your tax liabilities. You can also meet your quarterly 941 deadline with 123PayStubs as well as your annual filing deadlines for Forms W-2, 1099-NEC, 1099-MISC, and 940. Learn more about 123PayStubs here: https://www.123paystubs.com/