Have you Verified W2 Data?
Now is a great time to review YTD W2 data for accuracy while there is still time to make corrections! Our team is updating W2 data each Friday from now until the end of 2018 (only 6 weeks away!) to allow you ample time for review and corrections.
But – what should I look for?
Choose a selection of employees for review. Run the Standard Report called W-2 Detail for the current year to see a report of YTD information OR go into the employee records under Taxes > W2’s to see the actual forms.
Validate Box 12DD information: If YTD updates to employer contributions are required, send a request to email@example.com to receive a project scope document and timeline for corrections.
Review any special payments: Did you make any payments that require special W2 reporting? Review the IRS Publication 15 or the IRS W2 Instructions for additional reporting requirements on special earnings and deductions.
Review highly compensated employee FICA taxes: Employees making over a specific threshold are subject to additional Medicare withholding as outlined by the IRS Additional Medicare policy. Additionally, Social Security taxes stop after the annual limit is met by highly compensated employees; for additional details, review the 2018 SSA COLA Fact Sheet. While you should NEVER adjust FICA taxes manually in payroll, it is a common error that results in W2C’s and potential penalties for employers. Calculate the taxes and wages on the W2 to ensure your highly compensated employees were taxed correctly in 2018.
Compare state taxable wages to Federal: While some states do not follow the Federal tax policies for things like Section 125 wages , your employees’ state taxable wage totals (if applicable) should be very similar to their Federal. Did you have an employee earn wages in a different state during the year? You should review these employees’ W2’s carefully to ensure wages are being reported to the correct agencies.
Taxable Fringe Benefits: Have you recorded these properly for 2018? If you do not include these with other wages to cover taxes due, you (the employer) will be responsible for paying taxes on the employees’ behalf. Learn more by vising the Knowledge Base Article.
Speaking of the Knowledge Base…
Click the Knowledge Base menu item at the top of the page to access even MORE help articles to ensure your employee W2’s are right the first time! And as always, contact the HCM Service Team for assistance with Year-End questions.