Year-End: The Link Between CPAs, Employers, and Us
With all due respect to the U.S. Postal Service, this is our season too.
As the end of December approaches, our engine is revving up. But rather than ensuring holiday cards are delivered on schedule, we make sure employee bonuses are processed accurately and timely. In place of managing eleventh-hour purchases, we are squeezing in last-minute wage adjustments. And instead of delivery dates that revolve around the holidays, our focus is on the upcoming tax filing deadlines.
Fortunately, we don’t do it alone. The year-end payroll process is a team effort that involves employers, employees, their payroll service and accountants. We join around a singular, indispensable form: The W-2.
Though a seemingly simple annual wage statement, there is more to the W-2 than meets the eye. The W-2 reveals whether an employee is paying for after-school care for children, saving for retirement, or earns tips on the job. It tells us whether an employee moved this year, if he has group life insurance plan, whether he received sick pay, adopted a child, or used an HSA to pay for his medical expenses. The W-2 tells us the employment story.
This story is so vital, for it fuels a multitude of crucial corporate and individual tax requirements. As year-end approaches, employers leave no stone unturned in assembling employee information. Employers double- and triple-check records to ensure data is accurate down to the last social security number. They hand us this critical data, which we reconcile, code, and synchronize into a complete and accurate W-2. The forms are filed with the Social Security Administration and delivered to employees and accountants who use them to complete individual and corporate tax reports, closing the annual reporting cycle. The story is complete.
The IRS is not playing games when it comes to Form W-2. It is so essential, that penalties for failure to furnish to employees by January 31 add up quickly at $260 per form. If you miss the government filing deadline as well, another $260 per form may be added to the bill. And if that is not enough to consider, this year-end poses a new challenge as well…
As we enter year-end, two words linger on the forefront of our minds: Tax Reform. The face of taxation is poised to change drastically. No individual or employer will come away from the new tax plan untouched, no accountant is unaffected. Though what lays in store for 2018 remains uncertain, when we tackle it as a team, the challenge is less daunting. Together, we got this.
Our collective engines are humming. Our season is here.
And our Viventium resources make the season a little easier to navigate together. Visit our Tax Info page to find all your most important tax forms in one place. And don’t miss our upcoming Year-End Compliance whitepaper for all the facts and a little fun for year-end, coming soon to our Insights page.