What Is The Best Way To File Payroll Tax Reports and Payments
Apr 20, 2020
What Is The Best Way To File Payroll Tax Reports and Payments
When Is Free Not Free
One of the most onerous obligations of employers is complying with a myriad of reports and payments required by Fed, State, and Local taxing authorities. Many employers rely on what they perceive as free Fed, State, and local websites to file required reports and make payments. As with most business decisions employers need to evaluate the efficiency of operations and associated wasted time, as well as the liability of making mistakes resulting in fines and penalties for non-compliance.
What Employers Are Required To File.
Employers have different requirements to file based on:
- The number of employees they have
- How often they process payroll
- The State or States they operate in
- The nature of their business
- And other local requirements
Employers use Form 941 to:
- Report income taxes, social security tax, or Medicare tax withheld from employee's paychecks.
- Pay the employer's portion of social security or Medicare tax.
They also have state and local requirements for tax withholding, Unemployment withholding and deposits, and new hire reports. A business operating with employees in as few as two states may be faced with using 7 to 10 different websites.
If the employer works with Fed or State government contracts they may also have certified payroll reporting requirements.
When Is Free Not Free When it Comes To Payroll Tax Reporting Software
Although accessing these Fed, State, and local websites is free, the real cost is a result of the time required to process reports using the websites and the liabilities created by the difficulty in managing 7 to 10 different processes, transcribing data manually, and the nightmare created if filing is rejected. Add to this, up to 20% of all processes change quarterly.
Tracking 7 to 10 different processes is made difficult because no two are the same. They may require uploads, manual entry of data, and these processes often change without warning. Tracking 7 to 10 different sets of credentials, different methods of confirmations that the filings have been received, and 7 to 10 different taxing authorities to work with for support or rejection resolution makes this process anything but free.
Recent surveys have shown that payroll administrators spend twice as much time processing payroll tax reports and payments then they spend paying employees. This inefficient method creates direct employment costs and increases the liability of making mistakes resulting in fines and penalties.
What Payroll Reporting Options Do Employers have?
Traditionally the only option an employer had was to outsource the entire payroll process or pay an accountant to process reports and payments. These options create two significant problems. First, these services are prohibitively expensive. Second, the employer loses control of their payroll.
In the past decade the most efficient and affordable option is to use an in house payroll solution that has a comprehensive payroll tax reporting and payment feature. This feature should support all of the reports and payments the employer is required to file, provide a single set of credentials, a single process regardless of the report or payment being processed, a single support contact for all agencies involved, and guaranteed compliance eliminating the risk of fines and penalties.
These services should also provide an administration site for all communications, file tracking, confirmations, and other tools such as filing calendars and alerts, a knowledge-base for common questions, and live support options at no charge.
This option allows employers to maintain complete control of their payroll, it dramatically reduces the time spent processing reports and payments, and virtually eliminates the risk of fines and penalties because of rejected or late filings.
Aatrix Software has been a leader in payroll reporting and e-filing for decades. Aatrix is integrated into over 60 payroll solutions and hundreds of thousands of businesses in the US use Aatrix for payroll tax reporting and payments Check out the list of partners we work with at aatrix.com/partners.
Payroll Tax Reporting Testimonial
“Payroll should not be so complicated and this service makes it so very easy to be compliant.” IMS NV, INC
See this and many more testimonials on our testimonial page.