Reports, Reports, Reports

Reports, Reports, Reports - Spend LESS time doing tax adjustments!

Ever heard of the old saying – measure twice and cut once? The same thought process holds true in the payroll world. We have to check data multiple times to ensure it’s accurate before it hits the employee and returns are filed. Without reports to validate the data in your HR system, you as a payroll tax professional will more than likely spend most of your time correcting the employee tax records. Prior quarter and/or prior year adjustments, irate employee calls regarding incorrect taxes being withheld, issuing W2cs. Does this all sound familiar!

Tax adjustments can be extremely time-consuming depending upon what’s involved. The Payroll Tax Knowledge Center is here to help with best practices for reports that can be run prior to your payroll processing and even on a daily basis.

New Hire Report

Create a report to help identify all new hires. Validate if the data in your HR system make sense. For example, a new remote sales consultant’s work location is showing in the system for Georgia but the lived-in address is set up for Missouri. You will need to validate where the employee is working and then have the necessary data corrected for either the work location or lived-in address if it was entered inaccurately. New hire reports can be worked on a weekly basis for the pay period.

Transfer Report

Use this report to view employee’s who may have transferred to a different work location. If the work location has changed, ensure that the tax is set up correctly in the system for both employee and employer. At the minimum, review your transfer report weekly.

Address Change Report

If you are a large organization that hires a lot of employees, we suggest working this report daily. Check to see if your payroll vendor already has a canned report. If not, please create one that shows any employee that has had a home address change within the pay period. This report will assist you in ensuring that the appropriate state, local (including school district) tax is set up on the employee’s record accurately. Also, this report will be helpful in letting you know if a new tax jurisdiction for a local or state would need to be registered.

Report that identifies employees who are exempt (from Local, State, Federal, Social Security and Medicare taxes as well as Employer portions on FUTA and SUTA)

Your payroll vendor may already have these as standard canned reports for year-end. If not, it will be beneficial for you to have one created. Now, there could be a valid reason for an employee to show up on this report. For example, there may be a situation where you have a J-1 Visa student appear on this report. J-1 Visa students are exempt from Social Security and Medicare tax and should appear on this type of report. For best practice, it is best to work this report weekly and as close to the day before you begin your payroll processing. The goal would be to capture as many potential employee’s on the list and correct them. Note: Exempt and Blocked from tax are two separate things. Click here to understand the difference.

Negative Wage Report

A negative wage report is just that – it identifies negative wages on an employee’s record. For best practice, it is best to run your negative wage report after each payroll. The goal is to 1) of course have a blank negative wage report and 2) work these in a timely manner rather than wait until quarter-end or year-end to correct. If an employee does show on the negative wage report, you as the payroll tax person will need to research it in detail and then make the necessary adjustment to correct it. Note: you cannot produce W2s with negative wages. Therefore, review this report after you complete each payroll.