Even though year-end is months away, it’s never a bad idea to double check that your staffing agency has all the pieces in place to make sure the year-end filing and printing is a smooth process. The Lone Oak Payroll tax manager, Ariel Peterson, provides some insight into how your staffing agency can start to prepare for year-end early.
You might be thinking that year-end is months away and you have plenty of time for your year-end filing checklist. But from my seven years of experience as a tax manager here at Lone Oak Payroll, it’s best to start early for year-end and make sure employee records, tax account information and vendor forms are up-to-date and accurate. Here are six tasks your year-end team can start now to make sure year-end filing and printing goes smoothly.
1. Verify employee records.
It’s crucial to verify that employee profiles are set up accurately. The primary items to review include name, address, and social security number. From the Pay Set-up screen, you can confirm the accuracy of Federal and State exemptions, Marital Tax Status, Tax State, and applicable Local Taxes. I’d also recommend reviewing the “Employee Taxes” screen to make sure there were no taxes marked exempt incorrectly.
2. Make sure Federal and State Withholding tax account numbers are set up correctly.
Verify that the Federal and State Withholding tax account numbers are set up correctly, which are carried forward to the W-2s. These account numbers must be accurate to prevent filing issues for your employees. The Federal Withholding tax account number is your Federal Employer Identification Number (FEIN) while the State Withholding tax account numbers will be specific to your individual accounts. It may not be your FEIN. You can access these account numbers within the Jurisdiction Set-up (All Options > Administration > Employer Set-up).
3. Double check your 1099 vendors.
Under All Options > Vendors, double check that your Vendor List is accurate. If you will need to generate 1099 forms, make sure the “Generate 1099” box is checked. In case payroll was processed as a W-2 with taxes deducted in error, I’d also recommend verifying contractor’s tax history within their Pay Setup.
4. Evaluate your set-ups for Affordable Care Act (ACA) for accuracy.
The ACA year-end forms typically have a later due date than W-2s and 1099s; however, it’s best to review this early for accuracy. There are several ACA specific reports available in the system you can use to verify the accuracy of these forms.
5. Repeat Steps 1-4 at regular intervals throughout the year.
I’d recommend reviewing each of these steps regularly throughout the year, especially as year-end draws closer. This helps to ensure that your team has enough time to make corrections to any errors.
6. Evaluate options for tax filing and print services.
Closing the year is a big undertaking for staffing agencies with a pile of stressful paperwork and compliance tasks to complete. To make sure your staffing agency’s year-end team has the capacity to handle all the internal tasks to close out the year, you can consider the option of outsourcing W-2 and 1094/1095 printing services to a third party. As a Lone Oak Payroll funding or payroll processing client, our year-end team will process, print and mail your employees’ W-2s so that your staffing agency’s team has one less item to worry about and one less deadline to meet when it comes to closing out the year. If requested, we also take care of 1094/1095 printing for clients as well.
These are just a few tasks that I recommend staffing agencies start early in order to stay on top of year-end processes. If you want to learn more about our year-end services for filing and printing services, contact us today!
Ariel Peterson, Tax Manager
Ariel Peterson is the Tax Manager at Lone Oak Payroll and has been with the company since 2012. Ariel and her team handle everything related to payroll taxes for our clients, including tax filings and payments. In addition, Ariel and her team help clients manage their accounts, keep tax rates updated, and keep their accounts in good standing.