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Employers must have up-to-date payroll forms regardless of the number of workers they have. You’ll require regulated payroll tax papers like W-4 for new workers and W-2 for wage and tax statements to be in good standing with the IRS. Other less structured forms, such as direct deposit authorizations, may also help you arrange your company’s activities.
Employers’ Payroll Tax Forms
Here’s a more in-depth look at the payroll forms you could need to run your company:
Withholding Allowance Certificate (W-4)
The W-4 Form will tell you how much federal income tax to deduct from employees’ paychecks.
All businesses must provide new recruits with updated copies of Form W-4; workers should complete the form before or on their first day of work. You’ll need this information to figure out how much to deduct from employee paychecks for taxes each pay period. Employees may fill out the form with personal information such as their name, residence, marital status, and a list of dependents. W-2 Form preparation is made easier by keeping track of each completed W-4 Form.
W-2 Statement of Wages and Taxes
The W-2 Form includes an employee’s annual earnings, as well as taxes withheld, some retirement benefits, and other withholding information that may affect their taxes.
All companies must utilize the W-2 Form to record the total salaries given to workers over the course of the year. You’ll also add any withheld payroll taxes (Social Security, Medicare, and income taxes), as well as any other benefits. You’ll provide each employee a copy of their individual form by the 31st of the year following the one for which you’re filing. You’ll also have to submit copies of the forms to the Social Security Administration (SSA) as well as your state, city, or municipal tax agency.
Check that you have six copies of each W-2 Form you distribute (one each for your records, the employee’s records, the employee’s federal tax return, the employee’s city, state, and/or local tax return, you to submit to the SSA, and you to send to the city, local, and/or state tax department).
W-3 Form: Wage and Tax Statements Transmittal
The W-3 Form is a single document that contains a summary of all W-2 Forms; you’ll send it to the IRS along with copies of each W-2 Form.
If you issue W-2 Forms, you’ll need to fill out a W-3 Form and send it to the Social Security Administration along with copies of the W-2 Forms. It’s an overview of all the individual W-2 Forms you’ll be delivering throughout the year. In addition to total taxes and other benefit information, you’ll report the total salary and wage payments you paid to all workers.
Compare the totals to the information shown on the other payroll forms to ensure that all of the figures you provide on the W-3 flow. For example, add all individual income and wage totals recorded on W-2 Forms, and the total pay amount shown on your W-3 Form should match the overall compensation amount.
Federal Unemployment Tax Reporting (Form 940)
When you pay your federal unemployment tax payment during the year, you should file Form 940.
You must file Form 940 by January 31 of the following year if you paid federal unemployment taxes (FUTA) throughout the year (most companies are obliged to). It assists you in calculating and reporting your total FUTA tax liability, net of any payments received throughout the year. If you owe more than $500 in FUTA taxes for the year, the IRS requires you to report and pay the tax quarterly; if you pay your FUTA taxes each quarter and are up to date by year’s end, you may wait until February 10 of the following year (at the latest) to submit.
In general, you’re liable for the tax if your company:
- In a calendar quarter, paid or will pay over $1,500 to its workers
- At least 20 weeks of the year were spent employing one or more people
Keep in mind that you will almost certainly owe a state unemployment tax, which you will need to submit on a separate payroll form for your state. To be sure, go to the website of your state’s tax office.
Quarterly Federal Tax Return (Form 941)
With your quarterly federal income tax payments, include this form.
You must file Form 941 if you withhold income tax, Social Security, and Medicare (FICA) from your workers’ paychecks (or Form 944 if the payments are small). The total sums withheld will be reported. It will also assist you in determining and paying the amount of FICA taxes that your company is accountable for (the total matches what you should withhold from employee checks, ultimately around 15.3 percent of wages paid).
The deadlines are in January (for October through December), April (for January through March), July (for April through June), and October (for October through December) (for July through September).
Employer’s Annual Federal Tax Return (Form 944).
This form should be sent with your yearly federal income tax payments; this is normally for very small businesses.
The objective of Form 944 is the same as that of Form 941, however, it is used less often. This form is for employers who are qualified to make one payment yearly and have an annual tax burden of less than $1,000. It’s a report of the total revenue and FICA taxes withheld and due (employees’ and employer’s share) throughout the year (versus four quarterly payments).
Annual Information Return of Tip Income (Form 8027)
Form 8027 demonstrates how realistic your workers’ stated tip amounts are; if the total doesn’t satisfy IRS rules, you may be accountable for distributing extra money.
Only major organizations with employees that get gratuities on a regular basis will utilize Form 8027. (restaurants, bars, and companies in the hospitality industry). For the purposes of this form, “big firms” are defined as businesses with more than 10 workers on a regular business day. The primary function of this form is to record the total tip money collected inside the business and to compute the allotted tip amounts that employers are responsible for paying tipped workers (a component of several restaurant payroll procedures).
Allocated tips are extra sums that certain employers must pay out if their total reported tips seem to be too low for their company size. Form 8027 aids in the calculation of any outstanding balances. The deadline to submit a paper copy of the form is March 2 (for 2021), while the deadline to submit an electronic copy is March 31.
Schedule H (Form 1040)
Schedule H ensures that all members of your home pay the correct amount of payroll taxes.
If you pay cash compensation to home personnel such as nannies, caretakers, or babysitters, you must utilize Schedule H. You must record total salaries paid as well as taxes payable (FICA, FUTA; the form contains clear instructions to help you figure the amounts owed, so you don’t have to conduct your own research).
Certified Payroll Form WH-347
Contractors may use this federal form to complete their certified payroll reporting obligations; however, some states have their own forms. Make sure to double-check yours.
Employers who work on government projects must use the Certified Payroll Form. You must fill it out with data about every person participating in the project, such as name, hours worked, project name, money received, benefits provided, and so on, to guarantee the agency sponsoring the project continues to pay. It’s critical to provide the agency with an updated copy on a weekly basis.
Employers’ Other Payroll-Related Forms
For many businesses, the most important payroll paperwork are the employer and employee tax forms. Others, however, should be aware of (some especially related to payroll and others not so much). HR and payroll, for example, are inextricably linked, so you can’t or shouldn’t handle payroll without first submitting several crucial HR paperwork. Completing the correct contractor documents may also save your business time and money.
Forms for Employers and Contractors
There’s a big distinction between workers and contractors in that contractors have a lot more freedom since their employers can’t regulate how they do their jobs lawfully. There’s also a distinction in how you disclose the money you provide them. Contractors are not eligible for W-2, W-3, or W-4 forms. W-9 and 1099 forms are better to use.
When paying contractors, you’ll require the following forms:
- W-9 Form: The W-9 is a contractor’s version of the W-4. Before they start working, give each contractor a copy of the contract. It will gather data such as the employee’s name and Social Security number. It will be used to report to the IRS how much money you spent throughout the year (on Form 1099).
- This form should reflect the total income paid to contractors, similar to a W-2 (although it’s just for contractors who were paid at least $600 and doesn’t mention any taxes paid). One should be sent to each contractor, with a duplicate sent to the IRS.
- The 1096 Form is a summary of all the 1099 Forms you’ve sent out. It should show the total amount paid to all contractors and be linked to each 1099 you’re sending out.
Forms for Non-Tax Payroll
You may utilize a variety of non-tax payroll forms to assist you better manage your internal procedures. You may make them yourself or use a free online paycheck template since they are not regulated.
Here are three of the most common Forms for Non-Tax Payroll you should consider using:
- Employees who choose to receive their paychecks online rather than by paper check are given a direct deposit authorization form, which demonstrates you have authority to pay them by direct deposit and normally contains room for a routing and account number.
- Employees may use a time sheet to record their hours worked each period, and you can use it to verify work time before issuing payments.
- Paystub: A document that may be attached to each paycheck that displays a breakdown of total earnings, deductions, and other information. Some states need them (and specify what information should be included), while others do not.
Many firms need HR forms for new workers in addition to payroll forms, such as Form I-9 (used to check employment eligibility), and the Employer Identification Number (EIN) Form (used to get a state-issued number for reporting and paying taxes), and so on. These aren’t payroll documents per se (though they’re sometimes misunderstood as such), but they’re necessary before any paychecks are processed.
The Importance of Payroll Forms
Payroll forms are crucial because they allow companies to record, summarize, and report information about their employees’ paychecks and payroll taxes. It’s ideal to include them in your company’s operations so that they can be done on time. If you do not submit the right paperwork to the relevant authorities by the timeframes, you may incur fines. Gathering (and, in some instances, creating) the payroll forms that pertain to your firm is one of the first stages in learning how to manage payroll correctly. Payroll software providers may also be able to offer some advice and resources.
Payroll Forms: Key Takeaways to Remember
Many forms are tax-related and subject to IRS requirements; others are more flexible and may be produced in-house (direct deposit, time sheets, and so on). Although 1099s are normally considered vendor payments rather than payroll, they assist manage payments made to contractors.
There is a deadline for all IRS forms (s). The majority of employer payroll tax reports are filed quarterly, while some are reported yearly. You may establish deadlines for your in-house forms based on how you want to utilize the data (you can have employees submit timesheets weekly, biweekly, etc., depending on your pay cycle).
Conclusion
Payroll forms are a must-have for your company. As a small business owner, you should begin by obtaining the IRS forms that apply to your company. You may design additional, less-urgent forms for internal usage, but you’ll have to incorporate them into your procedures later.
Frequently Asked Questions
What forms are required for payroll?
Some of the most common forms that are required for payroll are W-2, 1099-MISC, tax form
What payroll does an employer need?
Employers need to provide a W4 tax form for each employee and their employer ID number.
