Last Minute W-2 Tips

Like clockwork, it’s once again time to start preparing W-2s for your company. Employees depend on their employers to prepare their W-2s accurately and deliver them as quickly as possible to ensure that they’re able to complete their tax returns quickly and without error. Additionally, the IRS has several rules governing the W-2 process. With all of the potential pitfalls and penalties associated with not correctly preparing W-2s for employees, it’s vital that employers get this process right every year.

Know the deadlines

Like most things that involve the IRS, W-2 preparation and delivery are heavily regulated, have strict deadlines, and are subject to penalties if not completed accurately and in a timely manner. Staying on track to meet these deadlines can save you a lot of time and headaches down the road.

Before completing and mailing your W-2s, you need to ensure that every employee’s contact information, including their mailing address, is correct in your system and on the W-2 form. Additionally, double-check the spelling of each employee’s name and their social security number.

Every employer is required to submit W-2 forms to the IRS and mail a paper copy of the form to employees by January 31 of each year. Additionally, if you have worked with any independent contractors throughout the year who were paid more than $600, you must file Form 1099 with the IRS and mail a paper copy to the contractor by January 31.

It’s the employer’s responsibility to complete and provide a W-2 form to every worker on time. If you are late filing your employees’ W-2 forms, you may have to pay a fine – and the longer you wait the higher the fine will be. Check out W-2: Delivery Your Duty to Your Employees to learn more about staying compliant with IRS rules regarding W-2 forms.

Check for compliance

Before you begin filing or submitting your tax documents to the IRS, it’s critical that you ensure your payroll documents meet IRS compliance standards. From employee classification to your EIN, keeping your payroll documents up-to-date and accurate is key to completing your W-2s successfully.

Keeping your payroll system organized and well-maintained makes W-2 processing much easier. A partnership with a PEO that provides payroll processing services can give you peace of mind and access to the compliance support you need to keep your business in-line with IRS payroll regulations.

One of the areas that the IRS will look closely at when reviewing your company’s tax documents is the classification of your workers. Correctly classifying workers is critical to remaining compliant with IRS rules. If you have independent contractors or freelance workers, check out Independent Contractors: Correctly Classifying 1099s to ensure that all of your workers are correctly classified.

Double-check everything

Something as common as a missed keystroke or reversing two numbers on a W-2 form can cost your business hundreds of dollars in penalties from the IRS. Even with automated payroll processing services, double-checking all of the information on your W-2 forms is key to ensuring that you don’t get hit with additional fees for inaccurate information.

Find the right solution

Don’t let W-2 processing get the better of you and your team. Even if you already have an in-house HR team, Sheakley’s PEO experts have the skills and expertise to deliver top-notch human resource solutions to meet the needs of your company. The technology tools offered by Sheakley allow for easier management of your employees’ PTO, vacation, check stubs and W-2s. Training and on-going education opportunities offered to your supervisory staff will ensure that the day-to-day management of your business remains compliant.

Learn more about Sheakley’s PEO team and contact us for your free consultation today. Stay up-to-date on all things Sheakley by subscribing to our blog and following us on social media. Join the discussion by commenting below.