End of Year Account Preparation
Purpose: To help you make sure that your payroll account is ready for the new year.
Tip: There are a few reports in TRAXPayroll that can be particularly helpful when reconciling your year-end information:
Final payrolls must be processed no later than December 29, 2020, for a pay date of December 31, 2020.
- Submit Third-Party Sick Pay (p.16)amounts to TRAXPayroll via email. Vendor reports may also be forwarded.
- Third-Party Sick Pay can be listed as TPS, Short Term Disability, Long Term Disability, Insurance provider Sick Pay, and STD.
- Review deduction reports to verify employee and employer amounts are correct (especially if required to be reported per the IRS Instructions for Forms W-2 or W-3).
- Record year-to-date Health Savings Account (HSA) employer contributions (p.15) and Employer Healthcare costs in TRAXPayroll if this has not been reported each pay period (these amounts are included on the forms W-2).
- Click here to learn more about Date Range reports if you need help running one of these reports in TRAXPayroll.
- Update both active and inactive employees’ addresses and verify Social Security numbers are correct for W-2 processing. TRAXPayroll mails all W-2s unless the employee has elected for paperless delivery(inactive employees will receive their W-2 by mail regardless of this option so be sure to validate their address).
- If you have an integration with BambooHR and your account is on Autosync, you can have your active employees use the 'Manage Payroll Info' link in the Company Links section on the BambooHR Home page to access the TRAXPayroll employee profile and select paperless delivery.
- Tip: You can run a report for W2 Delivery Method to see what your employees have elected.
- W2s will be available in your account by January 29th, 2021.
- Audit wage reports to ensure that any imputed income for the Group-Term Life Insurance Coverage (p.15)(over $50,000 of coverage) has been accounted for.
- TRAXPayroll offers a standard 'Extra Pay' type named "Imputed Income - GTL" for reporting purposes. When used, this pay type will map to box 12c on the W-2.
- Record any missing Taxable Fringe Benefits provided during the year (e.g. employee stock options, personal use of company vehicle, tuition, transportation, etc.).
- Ensure that 2% Shareholders paid through TRAXPayroll have been marked as such under the General page for Employee Tax Type for correct taxation of income and excludable deductions.
- Verify that any pay issued outside of TRAXPayroll or non-cash items are reported (e.g. gift cards, bonuses, etc.).
- Audit your reports to confirm that all voided or reversed paychecks have been recorded in TRAXPayroll.
- Tip: You can run a report for voided paychecks in TRAXPayroll.
- Audit employee pay to ensure that wages and unemployment insurance were reported under the correct state.
- Tip: The Complete Summary excel report can help you review this information.
*Items required to be reported following the final payroll deadline, may incur additional fees.*
- Update company and employee deduction annual maximums if needed.
- Review the pay period schedule for accuracy in the Company/Pay Group tab.
- Add any company holidays (if your organization uses this feature).
- Add next year's tax rates, tax filing deposit frequency, and unemployment tax rates in the Company/Tax tab.