Payroll procedure forms help principal accountants and payroll departments to ensure that wage and tax records are accurate and also aid in making sure that wage and tax records, as well as employment tax returns, are filed error free and on time.
Payroll Procedure Forms
Human Resources and payroll accounting use a variety of forms to make payroll management run smoothly. Payroll procedure forms can be bought at your local office supply store, found free online, or processed with payroll accounting software. Such forms include:
- Vacation Request Form
- Early Check Release Form
- Federal I-9 Form
- Holiday Schedule Form (Establishing paid holidays)
- Payroll Calendars and Schedules
- Sick Day Tracking Sheets
- Direct Deposit Requests Authorization
- Form 1099
- Form 940
- Form 941
- Misc. Payroll Procedure Forms
Payroll procedure forms and accounting software aid the payroll department in following employment laws, including a reconciliation schedule.
Reconciling Payroll Procedure Forms
Most employees receiving their checks each payday have no idea of the complex network of forms and procedures that the payroll department or accountant must follow. Payroll reports, tax deposits, tax returns and financial statements are directly related to each other. Reconciling payroll information means that all the financial information from these reports agree. It's important for reconciliations to be updated throughout the payroll process, to prevent undetected inaccuracies from carrying over from one sector of the payroll process to another. Payroll procedure forms used in the implementation of the various reconciliation phases necessitate the need to maintain accurate records.
Current Period Reconciliation
Payroll procedure forms protect the integrity of wage and tax information and must be updated on a regular basis. Current period reconciliation is performed after each payroll is processed. If you choose an automated payroll system, be sure to back up your files, to reduce the risk of losing vital information because quarterly returns and W-2 forms are generated from this information.
Tax Deposit Reconciliation
It's not enough to make tax deposits. Tax deposit totals should be reconciled before the deposit is made to be sure the totals are correct. This information is used to prepare Form 941 and various state returns, so reviewing tax data prior to the deposit being made saves the headache of cascading effects if an error goes unnoticed.
Quarterly Reconciliation (Form 941)
Form 941 works as the employer's quarterly payroll tax returns. Employers are required to withhold tax from each paycheck. The 941 Form reports these payroll taxes, current quarter's adjustments to Social Security and Medicare taxes as well as adjustments in prior quarters.
|Quarter||Time Period Covered||Due Date|
Note that if the last filing day falls on Saturday, Sunday or a federal holiday, the date the return is due falls to the next banking day.
An annual reconciliation should be completed before the last tax deposit is made at year end. This reconciliation ensures that Form 941 agrees with the W-2 form. Form 941 is filed quarterly. The W-2 Form is a Wage and Tax Statement. If there is a difference between the two, it needs to reconciled.
The W-2 provides employees with important information when preparing their federal and state tax returns. It also provides the Social Security Administration with information needed to update individual earnings records used for retirement, disability and Medicare benefit purposes. Employees' W-2 forms must be postmarked no later than January 31 of the following year.
Information Used In Reconciliation
- Gross wages: Includes base salary, overtime and additional special payments
- Social Security and Medicare taxable wages: Social Security wages are broken into two parts-Social Security (OASDI) and Medicare.
- Federal taxable wages
- Federal income tax withheld
- Social Security tax withheld
- Medicare tax withheld
- FUTA taxable wages
- State taxable wages
Individual State Payroll Taxes
State payroll taxes differ from state to state. National attention today is focused on child support payment delinquencies and welfare and unemployment insurance abuse. Congress has mandated new-hire reporting nationwide in its effort to reform the welfare system, and each state has specific instructions and regulations.
For years, the complications of state tax particulars led many businesses to outsource payroll processing. But with payroll software tools available today, many companies have found that payroll can be processed with more flexibility and with less expense in house.