Published: Feb 28, 2018

It's tax time! A payroll team’s favorite time of year. Alright maybe not the most favorite, but for anyone who loves spreadsheets and tax reconciliation, this is your moment to shine. For those of us who look at this season without the rose-colored glasses on, though, we sometimes dread it. Reconciliation and payroll tax reporting can make the best of us cringe a little—but there is hope. With the right set of tools, tax season can be approached with optimism, not fear. Here are the 3 key tools you need to make your tax season less stressful.

3 Tools every payroll team must have during tax season


1. Reporting engine to ensure accuracy

Before you even begin to think about filing any of your returns or releasing your W-2 wage statements, you need to make sure that you’ve reconciled your payroll data. Everything from gross wages to taxes to deductions needs to be reconciled and the best way to do that is to use your payroll software reporting engine.

For most, there are standardized reports that help make reconciliation a breeze, but what you really need is to make sure that each of those reports are summarizing to show the same totals. Gross wages by pay code, tax types, and deduction totals should be the same regardless of the report. Much of the information that is gathered for the Forms W-2 and W-3 with the SSA are also included in aggregate on the Federal Form 940, along with a variety of state and local reports. It’s important to make sure that the data is accurate and consistent from one form to another.

Rely on your payroll reporting engine to do the heavy lifting to gather and summarize your data. You’re in even better shape if you have dashboards and/or analytics to quickly compare data across multiple reports for any discrepancies.

2. Self-Service to keep your phone lines open

Self-service is the preferred method of distributing your W-2s to your employees. In accordance with IRS Publication 1141, employees must provide their consent to receive an electronic W-2 instead of a paper copy. Make sure to get your communication out early in January regarding your policy and intent to distribute W-2s. Any employees that want to sign up for electronic-only distribution need to do so before you print and post mark your hard copies. And, since you have all your employees’ attention, make it a fun campaign to go-paperless!

I promise you’ll find this to be a time saver. It reduces the number of calls and emails to your payroll and HR teams. It also reduces the number of requests for copies of current year W-2s. And, depending on your company policies and how long you’ve had your payroll software, you can even point employees to their self-service portal for prior years’ W-2s.

3. Mobile access anytime, anywhere

I would be remiss if I didn’t talk about the impact that mobile technology has made in the world of payroll. Just like self-service portals for your employees, mobile is now a must-have, not a nice-to-have feature for any company. Employees want and expect to have access to their information whenever they want it. Tax season is no different, and things like mobile access might even be more of a necessity this time of year.

Imagine that your employee just got confirmation that their accountant can squeeze them in tonight to have their taxes done. Great. Your employee gathers up all their tax information and heads off to the tax office. They’re sitting with their tax preparer and find out they forgot to print a copy of their W-2 from the self-service portal. No problem, they’ll just pull it up on their payroll system’s mobile app. What, no mobile app? Now they can’t file their taxes as planned.

Beyond the inconvenience, your employee is now frustrated and possibly angry that the company doesn’t have this functionality. You can imagine the conversation the next day when your employee comes to work…your unhappy employee is now spreading negative morale and impacting productivity for everyone around them. No company wants to get caught on the wrong side of that scenario.

But for the sake of this blog, let’s assume your company has invested in mobile, and your employees are using the mobile app. So, what’s next?

You’re ready to file!

Remember January 31st is the last day to furnish Form W-2, Wage and Tax Statement, to employees to report wages, allocated tips, and amounts withheld from wages in 2017. If an employee agreed to receive Form W-2 electronically, have it posted on your website (or your payroll software) and notify the employee of the posting. Don’t forget to mail or electronically file Copy A of Form(s) W-2 and W-3 with the SSA by January 31st.

If you are reading this after January 31st, then you already know the importance and timeliness of these three invaluable tools to payroll professionals. Remember, it’s never too late to invest in self-service and mobile technology—your employees will appreciate it, and you will immediately see time savings.

Since payroll’s work never ends, there are a host of other filing dates and requirements by tax type that should be on your payroll tax calendar as well. Don’t neglect the timing and the forms completion. Usually your payroll tax software will assist with this, use your payroll reporting engine to provide the right data, and follow through to make sure that forms and remittance are handled timely. If your system doesn’t or can’t help with these things, then it might be time to think about a change.

Now embrace the tax season with ease knowing you are prepared, your books balance, and your employees have their needs met.

Have fun balancing and reporting!