Your December Payroll Checklist

With so many bank holidays throughout December, business owners and HR leaders are scrambling to get everything in order before the new year. Payroll deadlines are approaching and tax information must be in order. Here are a few payroll best practices as well as a professionally-crafted payroll checklist to help you stay on track this December!

1. Double-Check Key Information

It’s important to double-check key payroll information before the new year hits in order to stay compliant. Beyond federal, state, and local taxes, you must also review:

• Reciprocal state tax agreements to ensure you’re paying local taxes with money deducted from employee paychecks.
• Subject wage limits to limit the correct amount of earnings subject to taxation for a given year.
• Tax credits to ensure that taxes owed to the government are being accurately subtracted.
• Exemptions and exclusions. These need to be properly displayed for items like vacation days, overtime, and bonuses.
• Employee type. This should display accurate payment schedules for full-time, part-time, seasonal, and temporary employees.
• Business type. This can affect tax and employee payment details. Double-check your business classification for accurate reporting.
• Business ownership. December is a great time to look this over. Has your organization gone through a change in ownership? Was the company bought out last year? If so, make sure all documentation of the transition is up-to-date to avoid inconsistencies in taxes and salaries.
• Proration. You want to make sure to address this potential pitfall. Make sure employee pay is accurate for any atypical schedules or hours worked.

Double-checking these payroll components will help ensure accurate reporting. Speed up the process and improve accuracy with the right tools. Payroll reporting can consume a substantial amount of time; using HR software will lessen the burden of administrative work at the end of the year and this payroll guide can help you through the process.

2. Communicate Special Circumstances

First, identify which types of workers you employ. How many are full-time, part-time, seasonal, and temporary? Full-time employees with benefits will have different tax implications and payroll deadlines than seasonal workers. Does your business depend on nonexempt employees? If so, there are basic records you’re required to keep. Make sure to stay compliant with the Fair Labor Standards Act.

3. Run Payroll at the Right Time

Does your organization support monthly, semi-monthly, bi-weekly, or weekly pay schedules? Maybe you operate on a few different cycles. Here’s a breakdown of paychecks that should be accounted for each year:

• Weekly: 52
• Bi-weekly: 26
• Semi-monthly: 24
• Monthly: 12

As an HR leader, it’s your job to make sure all of the numbers add up at the end of the year. Run payroll at the right time for each pay schedule to ensure your workers aren’t getting short-changed. For a little assistance, here’s a payroll checklist created by our payroll professionals to help you wrap up 2018:

Download your own copy here!

Between managing all different types of employees, filing taxes, maintaining a pay schedule, and many other tasks, payroll can quickly turn into an unnecessary burden. Luckily, a modern all-in-one payroll solution can take care of the heavy lifting in minutes.

This checklist and post is meant to be informative, but not necessarily exhaustive. It does not constitute legal or tax advice. Always check with a qualified legal or tax advisor for more complete guidance.