It’s that time of year!  As the days grow shorter, the payroll to-do list grows ever longer.  Today we’ll take a look at the general categories you need to deal with as year-end approaches.

First and foremost, confirm that your employees’ names, addresses, and social security numbers are correct in your payroll system.  And if you have any deceased employees, be sure they are properly coded. Trust me…the few minutes it takes to verify this information will save you countless hours (and expense) if an error is discovered after the W-2s have been printed. And remember to have your employees fill out a new W-4 (and state form, if applicable) if their tax situation is changing for 2013.

Are you going to be running a bonus payroll before year end?  Be sure to alert your payroll company in advance so they can add it to the schedule.  Last-minute unscheduled payroll runs can be costly.

Depending on your state, you may receive a notice from the Department of Revenue or the Employment Security Commission, as well as an IRS notice.  The Department of Revenue (or its equivalent in your state) and the IRS will alert you if your tax filing frequency is changing for 2013.  The Employment Security Commission (or its equivalent in your state) will let you know what the 2013 taxable wage base and your 2013 employment tax rate will be.  Don’t let these documents get lost on your desk!  Ensure your payroll provider has this information in hand before year-end so you don’t incur any penalties in early 2013 for failure to file in a timely manner or for underpayment of taxes.  Those penalties and interest add up quickly.

Does your company have a retirement plan?  Don’t forget to mark the retirement plan indicator for Box 13 of the W-2.

Finally, be sure you have gathered all the information you need to record insurance, sick pay, and fringe benefits on your employees’ W-2s.  These items need to be added to payroll before you run the final payroll for 2012.  We’ll take a look at these items in more detail in our next blog post: Year-End Payroll Reminders – What Needs to Be Added to the W-2.

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