Ready or not, April 15th is here.
There will no doubt be a mad dash to the post office as taxpayers, especially those who owe money, wait until the last minute to file their 1040. While the threat of being audited or paying significant penalties is typically enough for the average Joe to make sure all the “Is” are dotted and “Ts” crossed, there is no shortage of stories about tax evasion and fraud at this time of year.
For employers, tax time can be even more taxing 🙂 Not only is payroll a time-consuming, administrative burden that has to be done accurately and on time every payroll period, according to a recent report by the Treasury Inspector General, you now need to worry about penalties associated with payroll tax fraud as well.
If you think the IRS is hard on individuals, just wait until you don’t get your payroll taxes to them on time – or worse, not at all. And if the payroll provider you are using screws up, guess who the IRS is going to hold accountable? That would be YOU. That said, there are enormous benefits to outsourcing your payroll, including:
- Saves significant amount of time and resources
- Lowers your administrative costs
- Reduces chance for errors
- Allows you to focus on core competencies
- Decreases the number of payroll-related questions your HR/payroll department has to field (if your service provider offers employee self-service)
So what can you do to protect your company from payroll tax fraud and/or penalties that can result from inaccurate or untimely payroll tax filing?
Here are some suggestions to consider when selecting a payroll provider:
- Make tax filing part of your due diligence and be sure to speak to several long-standing tax filing clients
- Choose a company that is dependable and trustworthy; verify that they are properly bonded and insured
- Ensure the provider is properly paying the IRS on behalf of its clients; do they have a history of late filings or penalties incurred?
- Communicate your specific payroll tax requirements and deadlines and determine whether or not the provider can meet those needs with a reliable and easy-to-use solution
- Confirm the provider uses the latest technology and processes to keep your data safe and protected
- Choose a provider that has an excellent service reputation, is very transparent and upfront with its clients and communicates on a consistent and clear basis
By no means is this an exhaustive list of questions and qualifications but it provides a starting point to help you on your search for a payroll provider you can trust to keep your company out of hot water with both your employees and the IRS!