It’s the most wonderful time of the time - business is booming, holiday sales are up, employee morale is through the roof, and everyone is rocking around the office Christmas tree - that is unless you work in payroll, then none of this is true. The truth is, if you work in payroll, year-end can be one of the most stressful times of the year. Audits, adjustments, W-2s, fringe benefits, and much more are on the forefront of your mind; and we get it, it is overwhelming to say the least. So how are we going to get through year-end and keep our sanity in tact while doing so?
Plan and List, List and Plan
The best way to make sure your ducks are in a row is to organize your thoughts upfront. Let’s start with a list - what worked for you in the past? Did you have a process in place that went smoothly? Did you have a disaster last year-end? Avoid another one by planning out what can be done differently. Use a list to write out your earnings and deductions - are there new ones to add? Do you need to make changes to current earnings/deductions? How many audits will you hold? What all will you audit? Put this all out on the table so you know exactly what needs to be taken care of.
Take Care of Adjustments
While it is always recommended to enter adjustments into your payroll as they happen, we understand that doesn’t always happen. Instead of waiting until the end of the year, aim to enter monthly adjustments to stay on top of your process. Things like 3rd party sick pay, void checks, fringe benefits, and so on can be entered in each month, or each quarter, depending on your preference.Taking time to enter these as they occur before the end of the year will be helpful.
IRS and W-2s
Before the New Year begins make sure you’re checking the IRS website to see if there are changes being implemented into payroll. Things such as tax tables, and benefit limits should be checked to make sure you have accurate information. You will also want to provide your payroll provider with the new state unemployment tax rate. Once this is done it is time to audit those W-2s. There are a few things you can do to make sure your numbers are matching up. First, compare the fourth quarter 941 report to payroll reports. Add all 941s for the year and compare that amount your W-2s. If these check out you are free to send out W-2s to your employees.
Please keep in mind there are many things you can do throughout the calendar year to alleviate year-end stress. Planning quarterly audits, entering adjustments, and inputting paid holidays into your payroll software will greatly lessen your workload come December. For more tips and tricks on surviving payroll year-end download our Preparing For Year-End eBook.