Quarter-End Process. Kim Hylton Client Education Mgr. MPAY Inc

Transcription

1 Quarter-End Process Kim Hylton Client Education Mgr. MPAY Inc Daniel Summerville Corporate Accountant MPAY Inc.

2 Topics New Features Related to Tax Service Bureau Preparation The Quarterly Process Quarter-End Process 2

3 Quarterly Process: Sequential Method Audits Client Copies Filing Copies Company ABC Company ABC Company ABC Company XYZ Company XYZ Company XYZ Company 123 Company 123 Company 123 Quarter-End Process 3

4 Quarterly Process: Package Method Company ABC Company XYZ Company 123 Audits Audits Audits Client Copies Client Copies Client Copies Filing Copies Filing Copies Filing Copies Quarter-End Process 4

5 NEW in Company Taxes Master Co Setup/Taxes Tax Filing new in the drop-down list Highlight the tax code to change or view the sub-page information Quarter-End Process 5

6 NEW in Company Taxes (cont) Tax Filing Displays taxes from Setup area Highlight a tax code to display filing methods on the sub-tab Quarter-End Process 6

7 NEW in Company Taxes (cont) To change values: Client or Bureau cells: Enter the number of tax return copies to print (if filing method is paper) with each copy of the tax return package Click on the Filing Method cell to choose available filing methods Quarter-End Process 7

8 NEW in Master Company Setup Tax Filing Tab Quarter-End Process 8

9 Tax Filing Configuration No matter what method you choose to process quarterlies (Sequential or Package), the check boxes should be checked if you plan on processing that tab. Note: if you update tasks and find that nothing is populating on a certain tab for a company, check here first to see if the box is checked. The system defaults all check boxes as checked except for CPA Copies. Quarter-End Process 9

10 Tax Filing Configuration (cont) Use with Packages Method only Choose the Package of reports you want to print with each task Copies Dictates how many copies you want to print when using Packing Method Quarter-End Process 10

11 Tax > Filing > Reporting Able to print standard reports with the tax filing process Can set up on individual companies Company Maintenance/Reporting/Tax Filing Can set up globally to apply to all companies System/Tax/Filings/Reporting Can print PRE or POST printing Quarter-End Process 11

12 What Happens? The reports you add here or on the company level will be printed with the quarterly tax forms when you select this box on the relevant processing tab. Quarter-End Process 12

13 Tax > Filing > Reporting When using the Packages method for processing your quarterlies, set up folders under Reporting > Packages For example, set up 2 folders: Additional Client add reports here that you want to print w/certain packages, as determined on the Co. Tax Filing tab Just Tax Forms leave blank for packages where you want just the tax forms to print. Quarter-End Process 13

14 What Happens? When reports are added to the Packages folders on the System level select the applicable packages here only when you are using the Packages methodology. Quarter-End Process 14

15 Preparing for E-File IRS Form 8633 for your service bureau Form 8655 for your clients Process could take 4-8 weeks Preparing M3 Tax Preparer Information Company Maintenance/Taxes Quarter-End Process 15

16 What Is a Name Control? A name control is a sequence of characters derived from a taxpayer s name that is used by IRS in processing the tax return filed by the taxpayer. It is important that the combination of name control and taxpayer identification number (TIN) provided on an electronically filed return match IRS s record of name controls and TINs. A name control is established by the IRS when the taxpayer requests an Employer Identification Number (EIN). The IRS creates the name control from the legal name listed on the Form SS-4, Application for Employer Identification Number. Quarter-End Process 16

17 What Is a Name Control? (cont) When a return or extension is filed, the IRS checks whether a name/tin combination is correct by matching it against a file containing all employer identification numbers (EIN) issued by IRS. The name control listed on the return/extension is then compared to the name control on the IRS file. If it matches the name control in our records, it is considered to be correct. Quarter-End Process 17

18 Why Is the Name Control Important? A taxpayer s Employer Identification Number (EIN) and name control in the Return Header must match the data in the IRS e-file database. If the EIN and name control do not match, the e-filed return will reject returning Error: Reject R See IRS Publication 3823 for more information Quarter-End Process 18

19 Business Name Control Matrix Business Name Name Control Rule Sumac Field Plow Partnership SUMA Derive the name control from the 11 TH Street LLC 11TH first 4 significant characters of the corporation name. Blanks may be P & P Consulting P&PC present only at the end of the Y-Z Drive LLP Y-ZD name control ZZZ Club John Hackberry LLP Elm ZZZC JOHN ELM Oak! Tree OAKT When determining a corporation s The Willow LLC WILL name control, include the word The only when it is followed by The Hawthorne THEH one word Business Name Control Valid Characters Numeric (0-9) Alpha (A-Z) Hyphen (-) Ampersand (&) Quarter-End Process 19

20 Name Controls in M3 The system will look at the company Demographics tab to determine the name control. Sole proprietors or Individuals must override the name control. The system will do its best on the other organization types. If the Organization Type is left blank, the system will default to creating the name control as a corporation. Quarter-End Process 20

21 Overriding the Name Control To override the calculated name control in M3: 1. Company Maintenance > Master Company Setup > Taxes > Return 2. Highlight the FITW line in the list of company tax codes 3. Enter the name control in the Other 3 field 4. In cases where the IRS rejected the initial name control, recreate the file and resubmit Quarter-End Process 21

22 NEW Preparer: State Detail This replaces the need to have multiple preparers for mag media/electronic files R1, enter your company ETIN R2, enter your company EFIN R3, enter your company PIN R4, do not enter any information R5, T=Test or P=Production R6, enter your PTIN, if you have one Quarter-End Process 22

23 Preparer Info Preparer Info Before processing quarterlies, set up one or more preparers Setting up multiple preparers (by state) is helpful for sending Mag Media, then it is not necessary to constantly change the one preparer. This helps eliminate keying errors and omission of information. Quarter-End Process 23

24 New Tax Processing Tabs Packages Tab CPA Copies E-File (formerly Mag Media) Quarter-End Process 24

25 Packages Tab Used to process everything for one company at a time from a single screen Select Process Packages once to run audits Select Process Packages again to print everything Quarter-End Process 25

26 E-File Processing Returns here will create your files and place in the EFILE folder Quarter-End Process 26

27 Quarterlies: Getting Started The quarter ending date controls which quarter information will be displayed Quarter-End Process 27

28 Quarterlies: Getting Started (cont) The Quarter Ending date controls which quarter information will be displayed The Filter Drop List provides options to control which clients are displayed for the quarter date Quarter-End Process 28

29 Quarterlies: Getting Started (cont) The quarter ending date controls which quarter information will be displayed The Filter Drop List provides options to control which clients are displayed for the quarter date Quarter-End Process 29

30 Quarterlies: Getting Started (cont) The Update Tasks button will start the quarter process for all clients in the Open state with no unprocessed payrolls in the quarter Quarter-End Process 30

31 Quarterlies: Getting Started (cont) The quarter ending date controls which quarter information will be displayed The Filter Drop List provides options to control which clients are displayed for the quarter date Quarter-End Process 31

32 Quarterlies: Getting Started (cont) The Update Tasks button will start the quarter process for all clients in the Open state with no unprocessed payrolls in the quarter There are eleven tabs which perform separate functions. After initial setup of the Preparer Info, start with the Status tab and move right, processing the tabs that are applicable to you Quarter-End Process 32

33 Status Tab Status tab Status column Open quarterly process has not been started Active quarterly process has been started Done the quarter processed is complete or it has been manually marked Done to avoid processing For example: Template, Test, or Terminated companies Quarter-End Process 33

34 Status Tab (cont) Status tab Update Tasks You cannot start the quarter process if Message column indicates there are payrolls remaining in the quarter. Remedy by: Delete Open/Scheduled Checkdate Run a Zero Payroll (Recommended) Status - will not automatically reflect Done until all tasks are done or until manually marked as done. Status does not have to say Done for a Q process to be complete Quarter-End Process 34

35 Recommended Audit Reports Run for the Entire Quarter Setup Balance (MPI_3205) this report compares the tax liability and YTD tables to the pay history tables. Also compares calculated vs. actual amounts for EE & ER taxes Addt l Form Tolerance =.99 FICA Variance (MPI_3203) this report displays any variances with calculated vs. actual withheld FICA taxes. Note: if there are variances on this report, they should be fixed or the 941 will be incorrect. Subtotals Custom, by Co. ID, then EE ID Addt l Form Tolerance =.99 Tax Liability Variance (MPI_3201) ensures total liabilities equal total deposits Quarter-End Process 35

36 Recommended Audit Reports (cont) Other 100k Report (MPI_3206) ensure dep > 100K are made Scheduling Cleanup (MPI_3003) clean-up unprocessed calendar dates prior to quarter end TaxForm Count (MPI_7402) counts W2 & 1099 EE s Quarter-End Process 36

37 Consolidations/Multi-Co Tax Setup Consolidation Work Flow (option 1) 1) Audit company(s) for correct setup 2) Run the quarterly process for reports 3) Unconsolidate companies BEFORE processing payments tab 4) Reconsolidate AFTER payments are made and before the next payroll is processed 5) No journal entry corrections needed Quarter-End Process 37

38 Consolidations/Multi-Co Tax Setup (cont) Consolidation Work Flow (option 2) 1) Audit company(s) for correct setup 2) Mark Child companies as Done so tasks do not populate on tabs 3) Process as normal NOTE using this method will not populate the Payroll Manager correctly. If this is important to you, then use option 1. 4) Post Journal entries incorrectly so have to manually adj. Quarter-End Process 38

39 Consolidations/Multi-Co Tax Setup (cont) Parent/Child Relationship Parent must have same DET s as child If possible, use parent as template when setting up children companies Quarter-End Process 39

40 Consolidations/Multi-Co Tax Setup (cont) Aggregate Limits Use when one or more employees are in separate companies in order to respect caps on taxes across companies. Aggregate Tax Filings Ensures consolidation of tax filings for form/deposits Combines for the quarterly process only When processing quarterlies run the payments for the parent only Quarter-End Process 40

41 Consolidations/Multi-Co Tax Setup (cont) Create Procedures & Audits There is no error checking Audit parent/child are attachment Audit parent/child DET codes What if someone adds an E code to the child, but not parent? Audit parent/child Tax ID s, frequencies, & rates SSN must be correct across co s to recognize limits W2 s do not consolidate Do not process Parent/Child at the same time Develop check-list for the process Quarter-End Process 41

42 Quarterly Process Suggestions Use check-off lists especially for packing and shipping Excel spreadsheet or Tax Jurisdiction Report Get proof of mail (for tax notices) Create a process for Quarter-End Run monthly audit reports Quarter-End Process 42

43 Thank You Don t Forget to Complete your survey Quarter-End Process 43