As the hot, sticky air of summer clears out, now is the time for you and your employees to do some clearing out of your own.
The payoff: A smoother year-end Payroll process.
√ Verify your 2013 deposit schedule. Monthly depositors in 2012 deposit semiweekly in 2013 if the total taxes on the four 941s filed for the last two quarters of 2011 and the first two quarters of 2012 exceeded $50,000.
√ Plan holiday pay schedules by reminding managers of the deadlines for submitting time sheets.
√ Send 2012 W-4s to employees. Employees can compare their withholding to their tax liability. If they’re underwithheld, they can adjust their withholding. Use these W-4s to fulfill your solicitation duties, if you receive a notice from the IRS that an employee’s name/Social Security number doesn’t match.
√ Review vendor files for vendors’ Taxpayer Identification Numbers (TINs). Begin backup withholding for vendors that didn’t provide their TINs prior to payment. Solicit TINs by sending them Form W-9. Begin compiling Form 1099-MISC data for tax year 2012.
√ Remind employees to inform you of name or address changes, beneficiary changes, changes to pretax deductions into 401(k) plans and changes to direct deposit accounts.
√ Research outstanding checks that are older than 30 days; post unclaimed checks to an unclaimed earnings account.
√ Inform employees enrolled in health flexible spending accounts (FSAs) without grace periods that they will forfeit amounts left in their accounts at the end of the plan year.
Option: Employees can accelerate expenses into this year.
√ Remind those with health FSAs of the $2,500 pretax deduction limit for plan years beginning in 2013.