A major task of Payroll department is providing W-2 Forms to employees and to the Social Security Administration. This year it is more important than ever for employers and payroll processors to be aware of the impact of W-2 tax form errors. Penalties have been increased and filing due dates have been moved up. The Forms must be correct, complete and filed on time or the employer may face stiff penalties.
For 2016 W-2 Forms the due date for filing the forms with the Social Security Administration has been moved up to January 31, 2017. As a result of the compressed filing period, the IRS expects to see more errors on W-2 Forms, but has provided some additional penalty relief for certain de minimus error corrections for returns filed after December 31, 2016.
Objectives of the Presentation
Why Should you Attend
- Filing Errors - types and causes and how to avoid them
- Correcting Forms W-2 - employee copies and filing copies
- Name and SSN Mismatches - SSN verification and reasonable cause exceptions to penalties
- Incorrect Withholding - when and how to correct
- Correcting wage underpayments and overpayments
- When Form 941 must also be corrected
- Filling out Form W-2c - box by box
- Employee Misclassification- How to correct- W-2 or W-2c?
- New filing deadlines for 2016 information returns
- New rules regarding reporting of errors and changes to de minimus error rules
- Increased penalties for 2015 and later returns
Payroll taxes are a serious issue for the IRS. Two thirds of federal taxes are collected through the payroll tax system. By law, employers must withhold federal income, Social Security and Medicare taxes from employees' wages. In response to instances of identity theft and tax fraud involving W-2 Forms, the IRS and Social Security Administration changed the due dates for filing certain information returns including W-2 Forms.
Under current rules, employers were able to use the time between the due date for issuing W-2 Forms to employees and the due date for filing the Forms with the SSA to correct errors detected by employees or their tax advisors. The IRS expects that the earlier filing date will result in more errors on Forms W-2 because employers will no longer have time to correct errors reported by employees prior to the filing due date. The IRS also instituted new rules regarding corrections that cover de minimus errors in dollar amounts. Currently, errors in dollar amounts are never de minimus and must be corrected with the SSA.
In addition, the penalties for non-compliance were increased for returns filed after December 31, 2015 and are indexed for inflation. It is more important than ever to prevent errors and correct any errors that do occur as quickly as possible. There are also special situations where corrections are required that are not due to errors on the previously filed Forms. For example, corrections of Form W-2 due to employee repayment of a prior year wage overpayment. There are special procedures for such situations that must be followed to prevent future errors.
It is important for anyone dealing with payroll to be aware of the impact of errors on an employer in terms of costs of correction and penalties and how to eliminate or mitigate errors and the effects of errors.
Who will Benefit
- Know how to use Social Security Resources to prepare, submit and correct W-2 forms
- Know which actions to take before year end to avoid employee information return errors
- Be aware of common W-2 errors and how to avoid them and how to correct them if they occur
- Know what to do when an employee's name or tax ID number is incorrect
- Understand methods used to reconcile to Forms 941 and what to do if differences are discovered
- Be aware of the new filing deadlines and related error correction rules
- Be aware of the increased penalties for non-compliance and how to avoid or minimize them
- Understand what is required to establish reasonable cause for discrepancies or errors
- Know how to use Form W-2c to make corrections
- Know which corrections are made using Form W-2
- Payroll Professional
- Public Accountants
- Internal Auditors
- Tax Compliance Officers
- Enrolled Agents
- Employee Benefits Administrators
- Officers and Managers with Payroll or Tax Compliance Oversight
- Company / Business Owners
- Managers/ Supervisors
- Public Agency Managers
- Audit and Compliance Personnel
- Risk Managers