Year-end can be a stressful time for payroll administrators. As we are sure you know, year-end involves an abundance of tax, compliance, reporting, and communication issues that all must be addressed to ensure successful processing.
All employers must file W-2 forms with the Social Security Administration (SSA) by January 31, 2023. You also need to file any 1099 and 1095 forms with the IRS. Payroll mistakes and compliance issues could result in penalties, additional work, and disgruntled employees.
To make this process easier, we have put together our 8 top tips to help you manage year-end this year.
Tip 1: Void & Manually Update Checks
Do you have any manual checks that need to be entered into the payroll system?
If yes, you must enter the manual checks into payroll before the close of your 2022 year to properly collect and pay the taxes as well as document needed reporting requirements (i.e., SUI / FUTA).
Are there any 2022 checks that need voiding?
If yes, the voided checks must be processed in the quarter they occurred. Prior quarter voids must go through the Client Support team for Payroll Network (PNI) clients.
Did any of your employees receive Third Party Sick Pay/Disability payments in 2022?
If you have employees being paid either short-term or long-term disability pay (also called 3rd party sick pay), the amounts need to be sent to Payroll Network. We will guide you through entering the amounts into your isolved payroll system to record the payments and pay any employer-matching taxes due properly. These amounts need to be entered with a regularly scheduled payroll for 2022 and must be done before year-end. (You can request this information in advance from your 3rd Party Sick Provider before year-end.)
However, if you're a PNI client and your disability policy is one whereby the insurance company pays the company matching taxes and reports the W-2 to the IRS, you should not send the information to Payroll Network.
*Please note that any voids or manual checks not entered with or prior to the last payroll of 2022 or prior quarter adjustments will incur additional charges for the adjustment payroll runs. The deadline for any adjustments will be 12/28/2022.
Tip 2: Review Employee Data
As HR, you can run reports to audit this information and remind your employees to review their address and SSNs to ensure it is correct before the end of the year.
Do you have a Self Service platform? When you do, you can have your employees audit their own information.
Has anybody moved during the year?
Please correct any address changes for your employees so their W-2s will have the current address. The W2 may not reflect the correct state if not correct timely. If any of your employees moved during the year, was their address updated in the system timely, and were the proper state taxes withheld? If not, and you're a Payroll Network client, please notify Support at firstname.lastname@example.org to make the adjustments.
Ensure Employee Social Security Numbers Are Correct
Check the social security numbers for accuracy. The most common reason for corrections is incorrect social security numbers. Please ensure that your employees' numbers are accurate, and if you're a PNI client, notify us of any corrections that need to be made at email@example.com. Important: do not send SSN information via email to anyone.
If you utilize an employee self-service portal, you can also have your employees log in and verify their own information.
Tip 3: Avoid Payroll Adjustments & Report Auditing
Review Your Exceptions Report
Please make sure you are reviewing the client report called Exceptions when you are previewing your payroll. This should be done year-round. The Exceptions Report will show if there are any issues still lingering with your employees, such as missing street addresses, duplicate social security numbers, missing tax IDs, and variances.
You can view the Exceptions Report under Client Reports. If you have any exceptions you are unsure how to correct as a PNI client, please reach out to Support at firstname.lastname@example.org, and our team is happy to help you.
The best result in a streamlined year-end is to audit and correct payroll information before your last processing of 2022.
The deadline for any adjustments is 12/28/2022.
Tip 4: Remember These Important Dates in December
If you are still planning to process a Bonus Payroll outside of your normal payroll for year-end and you're a PNI client, you must contact our support team before 12/9/2022 to set up a special payroll for this year – email@example.com.
These payrolls must be processed by 12/28/22 if being paid in the 2022 year.
Year-end resources can be found on our website here.
Important Dates - December:
- 12/2/22: Review the 2022 processing schedule and calendar
- 12/9/22: Review employee addresses and social security numbers
- 12/9/22: Complete the Year-end Authorization Survey (located under Links on your Client Landing Page in isolved)
- 12/9/22: Last day to request bonus payrolls.
Before Processing the Last Payroll of 2022
- Enter any 3rd Party Sick
- Enter any GTL over $50k
- You can request this from your vendor in advance
- 12/26/22: Payroll Network closed
- 12/28/22: Last day to process 2022 payrolls
- 12/28/22: Last day for any adjustments
- 12/28/22: Last day to request deferred printing of W-2s (fees may still apply)
- 1/2/23: Payroll Network closed
Tip 5: Go Paperless
Paperless Year-end Forms & Payroll
Empower your employees by using an Employee Self-Service platform to access their personal information, pay stubs, and year-end forms. They will be able to access this information 24/7. This eliminates the need to contact your Payroll and HR support team for information because it will be at their fingertips, saving you valuable time in busy times.
The Advantages of Going Paperless:
- Implement a secure way to receive information.
- Eliminate the possibility of lost or stolen statements.
- Access their statements at any time. No need to retain paper statements.
- Reduce paper and the energy used to deliver paper statements, thus helping the environment.
- Receive an automated alert when tax forms become available.
- Support COVID Work from home arrangements.
Tip 6: Payroll / W-2 Delivery
Have or will you change your address for W-2 delivery purposes?
If you're a PNI client, we do require a signature for your W-2 delivery. If your office is closed and you are working remotely, we will need to make sure the correct address is set up for where you want your hard copies of W2s delivered.
Have you considered electronic delivery of your employee's W-2s?
An employee Self Service portal offers the opportunity for your employees to receive W2, 1099, and 1095(ACA) forms electronically. Electronic delivery is a secure way to have your employees receive their year-end forms without getting lost in the mail.
Important: All Employee updates to address and SSNs must be completed/correct before your last payroll processing of 2022. If you're a PNI client and need us to set up your address or are interested in Electronic Delivery, please reach out to our Support Team by emailing firstname.lastname@example.org.
Tip 7: Last Payroll of 2022 & Deadlines
Reminder: Mark Your Calendar for December 28th
Wednesday, December 28, 2022, is the last day to process payrolls with a 2022 pay date for direct deposit or checks. Please keep in mind that any payroll or adjustment runs necessary after this date may incur additional charges depending on your provider.
Before your last 2022 payroll, you should:
Ensure Your Employee's SSNs and addresses are correct
Send any Third Party Sick Pay to email@example.com
Enter any adjustments to ensure W-2s are accurate
Enter any Employer HSA Contributions for 2022
Enter any manual checks you may have provided
The taxable portion above $50,000 must be entered before the last payroll if you offer Group Term Life for your employees.
Include Fringe Benefits - i.e., Auto Allowance and S-Corp Insurance for 2% owners
Any adjustments to your 2022 Payroll must be received by 12/28/2022 due to W-2 processing needs for PNI clients.
Tip 8: Perform a W-2 Audit
Verify W-2 information in advance. It would be best if you previewed W-2s in isolved in advance under these reports:
Employee W-2 Preview
Employer W-2 Verification
*Ensure your State's Tax IDs are present. This could prevent your employees from filing their tax returns. The Exceptions Report every payroll will show this missing information.
Q&A: Can employees access it electronically?
Yes, if you go paperless. We recommend that clients go paperless for security reasons and easy distribution. If interested, please get in touch with our support team before the end of the year by emailing firstname.lastname@example.org.
W-2 processing will begin the 1st week of January. You'll want to review your W-2s in December to ensure they look appropriate. As always, if you're a PNI client, please reach out no later than 12/28/22 for any W-2 changes. If you have any concerns, feel free to reach out to email@example.com.
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