Preparing for Year End: Year-End Reporting

Transcription

1 Comprehensive HR Preparing for Year End: Year-End Reporting Handout Manual V _2CHR Copyright ADP, LLC

2 ADP Trademarks The ADP logo and ADP are registered trademarks of ADP, LLC. ADP Workforce Now is a registered trademark of ADP, LLC. The Bridge Sponsored by ADP & Bubble Talk Design is a registered trademark of ADP, LLC. ADP A more human resource. SM is a service mark of ADP, LLC. Third-Party Trademarks Adobe and Acrobat are registered trademarks of Adobe Systems Incorporated in the United States and/or other countries. Chrome TM browser is a trademark of Google Inc. Firefox is a registered trademark of Mozilla Foundation. Microsoft, Excel, and Windows are registered trademarks of Microsoft Corporation in the United States and/or other countries. All other trademarks and service marks are the property of their respective owners. Copyright ADP, LLC. ADP Proprietary and Confidential All Rights Reserved. These materials may not be reproduced in any format without the express written permission of ADP, LLC. Any repurposing, reposting, or other use of this content (including but not limited to YouTube or any other social media) is expressly prohibited. ADP provides the publication as is without warranty of any kind, either express or implied, including, but not limited to, the implied warranties of merchantability or fitness for a particular purpose. ADP is not responsible for any technical inaccuracies or typographical errors which may be contained in this publication. Changes are periodically made to the information herein, and such changes will be incorporated in new editions of this publication. ADP may make improvements and/or changes in the product and/or the programs described in this publication at any time without notice.

3 Preparing for Year End Year-End Reporting V _2CHR

4 Audio You should be hearing the audio through your computer. If you do not have sound, check the volume settings. If difficulties continue, try pressing F5 to refresh your screen. You can also try switching your Internet browser to another browser, such as Mozilla Firefox or Google Chrome. 2

5 Questions and Answers 3

6 Resource List 4

7 Maximize Your Screen Maximize 5

8 Certificate of Completion At the end of the session, click the Certification icon at the bottom of the screen. A Certification window opens. Click the Certificate icon in the lower-right corner to download your Certificate of Completion. 6

9 Course Purpose This webinar prepares you to use source documents needed for a successful quarter-end and year-end closing. 7

10 Objectives Upon completing this webinar, you will be prepared to do the following: Describe how ADP processes adjustments. Reconcile quarter-end and year-end reports. 8

11 Agenda Affordable Care Act Reporting (Health Care Reform) Bonus and Final Adjustment Processing Reconciling Quarter-End and Year-End Tax Reports 9

12 Affordable Care Act Reporting (Health Care Reform) Overview In this topic, we will discuss the following: Generating a report of group health care insurance costs for Form W-2 Additional resources 10

13 Generating a Group Health Care Insurance Costs Report Step 1: On the Home page, select Reports > HR & Benefits Reports > Report Management. In the Report Type list, select Group Health Insurance Costs on Form W-2. 11

14 Generating a Group Health Care Insurance Costs Report (cont.) Step 2: On the People page, select whom you wish to display on the report and the benefit plans or plan. 12

15 Generating a Group Health Care Insurance Costs Report (cont.) Step 3: Enter the memo code and date range. 13

16 Generating a Group Health Care Insurance Costs Report (cont.) Step 4: Select the files to generate, including the W-2 Plan Summary Report. 14

17 Generating a Group Health Care Insurance Costs Report (cont.) Step 5: You can request to receive an notification when the report is completed. Then, click Finish to generate the report. 15

18 Generating a Group Health Care Insurance Costs Report (cont.) W-2 Summary Report W-2 File Sample 16

19 Generating a Group Health Care Insurance Costs Report Step 1: On the Home page, select Reports > Standard Reports > Benefits. 17

20 Generating a Group Health Care Insurance Costs Report (cont.) Step 2: Select Standard > Benefits > W2 Detail. 18

21 Generating a Group Health Care Insurance Costs Report (cont.) Step 3: On the Selection Options page, select the company, enter the date range, and select the memos to include on the report. 19

22 Generating a Group Health Care Insurance Costs Report (cont.) Step 4: Confirm the system defaults, or edit the fields as needed. Then, click Run. 20

23 Generating a Group Health Care Insurance Costs Report (cont.) Step 5: The status will display Processing until the report is completed. Once completed, select the report title to view it. 21

24 Generating a Group Health Care Insurance Costs Report (cont.) The following is a sample report displayed in Excel Output format. 22

25 Additional Resources: Eye on Washington 23

26 Additional Resources ADP ACA Annual Reporting: Are You Ready? (recorded webinar) Affordable Care Act (ACA) Compliance learning bytes 24

27 Additional Resources (cont.) Internal Revenue Service (IRS) FAQs for Employer-Provided Health Coverage Reporting Requirements Informational-Reporting-Requirements:-Questions-and-Answers Form W-2 Reporting of Employer-Sponsored Health Coverage Sponsored-Health-Coverage FAQs for Form 1094-C and Form 1095-C Answers-about-Information-Reporting-by- Employers-on-Form C-and-Form-1095-C 25

28 What Do You Think? Health Care Reform? The Affordable Care Act requires employers who file 200 or more Forms W-2 to report the total cost of coverage under an employer-sponsored group health plan. a. True b. False 26

29 Topic Summary Employers are responsible to report the total cost of coverage under an employer-sponsored group health plan on employee Forms W-2. Reporting is required for employers who file 250 or more Forms W-2 in Reporting is voluntary for employers who file fewer than 250 Forms W-2 in You can generate a report that displays the group health insurance costs at the end of the year after the last payroll. 27

30 Bonus and Final Adjustment Processing Overview In this topic, we will discuss the following: Verifying employee information Important items to include Identifying adjustment situations Out-of-sequence payrolls Amendments Avoiding agency assessments Tax Direct Tax Resolution Services Projection reports for Flexible Spending Accounts (FSAs) and Retirement Savings Accounts (RSAs) 28

31 Verifying Employee Information Verify that the following information is correct on your company s Masterfile for your employees: Addresses Names Social Security numbers 29

32 Important Items to Include Before your last payroll of every year, make sure that you include the following: Employee bonuses Manual and voided checks Exercised stock options Special compensation options 30

33 Identifying Adjustment Situations Many situations warrant payroll adjustments. The most common situations that may cause the need for adjustments are voiding a check with the following errors: Previously issued For the wrong employee With no positive wages in the same quarter on a company level to offset the void. Your company cannot have quarter-to-date negative taxable wages. 31

34 Out-of-Sequence Payrolls The following describes an out-of-sequence payroll: A payroll in the current quarter or year processed out of the normal sequence or not originally scheduled Run after the last regularly scheduled payroll but before the quarter or year cutoff date Scheduled by your dedicated service team Authorized by you A payroll that generates updated payroll and tax reports, including Forms W-2, if applicable A payroll that may have penalty and interest costs 32

35 Adjustment Considerations When processing additional payrolls or adjustments, consider the following: Is the delivery date of the payroll at least 48 hours before the pay date? Have other payrolls or adjustments occurred within the same tax deposit period? Is this a credit or an adjustment payroll? Tax deposit liabilities of $100,000 or more are due the day after the pay date. 33

36 Amendments Are adjustments processed after a specified date in the following quarter or year Are corrections to a tax return that you authorize ADP to file on your behalf May result in penalty and interest costs 34

37 Avoiding Agency Assessments To avoid agency assessments or penalties and interest, institute the following payroll best practices: Monitor deposit frequency for changes or updates. Notify ADP of experience rate changes or updates. Notify ADP of federal, state, or local identification number changes or updates. View agency notices using ADP s Agency Notice Manager through ADP SmartCompliance. Verify new payroll entries to ensure accuracy. 35

38 Verifying Flexible Spending Account (FSA) and Retirement Savings Account (RSA) Deductions To verify employer FSA and RSA deductions, you can generate projection reports. Access the following reports on ADP Workforce Now by selecting Reports > Standard Reports > Benefits > Benefits. FSA Plan End Projection Report RSA Year End Projection Report 36

39 Verifying Flexible Spending Account (FSA) and Retirement Savings Account (RSA) Deductions (cont.) Access the Support Center to view learning bytes about how to generate the reports. 37

40 Tax Direct Tax Direct consultants are available to assist you with tax-related inquiries, such as the following: Tax invoices Tax filing and deposit questions Deposit frequency E-file Late or delayed funding (potential principal and interest) Payroll, deposit, or invoice holds Agency-call requests Company-made deposits Tax refunds Copies of tax returns 38

41 Tax Resolution Services Tax Resolution Services is responsible for resolving issues regarding tax agency notices and tracers. To contact the Tax Resolution Services team, access the Administrator Support menu. 39

42 Topic Summary At the end of each quarter and at year end, ADP handles the processing of various payroll adjustments. Processing adjustments ensures that your quarter and annual reports are accurate if you encounter an error. Tax Direct and Tax Resolution Services are available to assist you with tax-related inquiries and issues. 40

43 Reconciling Quarter-End and Year-End Tax Reports Overview In this topic, we will discuss the following: Master Control Wage and Tax Register Quarterly and Annual Statements of Deposits and Filings Quarterly Wage Reports Tax and distribution forms Reconciling payroll information 41

44 Master Control Accompanies each payroll Contains up-to-date Masterfile information, which should be periodically verified for accuracy Contains current quarter-to-date and year-to-date totals, which should be periodically verified for accuracy Feeds into the quarter system to create quarterly reports 42

45

46 Wage and Tax Register Quarter-to-date and year-to-date information is included for the following: Wages Taxes Taxables Other tax-related figures If the information is included on the Wage and Tax Register, it will be displayed on the Form W-2. 44

47 Wage and Tax Register (cont.) The Wage and Tax Register consists of the following: Instructional materials Detail pages Totals pages Recap reports, as applicable Credit pages, if applicable 45

48

49 Special Indicators Special indicators displaying on the Wage and Tax Register indicate errors. The most common errors are as follows: Address (city, state, or zip code missing) Social Security number missing or invalid Credit employee excluded from the quarterly Form 941 Credit employee excluded from the Quarterly Wage report Credit employee excluded from the State and City Income Tax Reconciliation Worksheet Credit employee excluded from all annual reports (Form W-2, Form 940, and so on) 47

50 Special Indicators: Common Causes Common causes for credit employees include the following: Voiding a check in the incorrect quarter Entering other compensation as a positive amount in payroll Common causes of special indicators for Social Security numbers are numbers that are displayed as follows: ###-##-#### 48

51 Wage and Tax Register Credit Employees A credit employee has either of the following: A negative quarter-to-date amount A quarter-to-date amount greater than the corresponding year-todate amount for the following: Gross Tips Tip credits Weekly employer-paid FICA Employer SUI exempt Employer Social Security and Medicare exempt Employer FUTA taxable exempt Employer SUI wage base Employer Social Security and Medicare wage base 49

52 Quarterly Statement of Deposits and Filings (SOD) Provides details of all tax activities and tax deposits made by ADP on your behalf Available after the quarter or annual filing deadline in ADP SmartCompliance Contains all information needed to prepare any quarterly or annual jurisdictional filings when used in conjunction with other payroll records Contains a federal page with Form 941 or Form 943 information and state and locality pages, if applicable 50

53 Statement of Deposits and Filings (SOD) 51

54 Quarterly Wage Report Every state requires a quarterly state filing. Remember to do the following: Check your Quarterly Tax Verification letter to verify the states for which you are responsible to file or for which ADP is responsible. Only file the states for which you are responsible. Check for employees with credit conditions who may be excluded from the state wage information. 52

55 Quarterly Wage Report (cont.) 53

56 What Do You Think? Verifying Information? Which report verifies employee tax status, scheduled deduction codes and amounts, and accumulations to date? a. The Quarterly Statement of Deposits and Filings b. The Master Control c. The Wage and Tax Register d. The Quarterly Wage Report 54

57 Form W-2 and Earnings Summary Reflects the employee s final pay stub totals plus any adjustments that you post after the last pay date Details how reported wages were calculated Details the taxability of each routine Provides employee Form W-4 profiles Provides Social Security numbers 55

58 Form W-2 and Earnings Summary (cont.) Section 1: Reflects the employee s annual totals Section 2: Provides details of adjustments to gross earnings for reported wages in Boxes 1, 3, 5, 16, or 18 of the Form W-2 and also provides notation of fringe benefit amounts Section 3: Displays the employee Form W-4 profile, including marital status, exemptions, and tax overrides for blocked or additional taxes 56

59 Form W-2 and Earnings Summary: Section 1 57

60 Form W-2 and Earnings Summary: Section 2 58

61 Form W-2 and Earnings Summary: Section 3 59

62 Form W-2: Taxable Wage and Tax Withheld Boxes Taxable Wages Box 1: Federal Box 3: Social Security Box 5: Medicare Box 16: State Box 18: Local Taxes Withheld Box 2: Federal Box 4: Social Security Box 6: Medicare Box 17: State Box 19: Local Note: Amounts may not always be the same as total gross wages. 60

63 Form W-2 61

64 Other Important Form W-2 Boxes Box 8: Allocated tips Box 10: Dependent care benefits Box 11: Nonqualified plans Box 12 a, b, c, d: See instructions for Box 12 (codes for 401[k], GTL, moving expenses, and so on) Box 13: Statutory employee, retirement plan, third-party sick pay Box 14: Other (California SDI, personal use of company car, client-defined literals) 62

65 Employer Forms W-2 Copy A: Social Security Administration ADP files Forms W-2 and Form W-3 on your behalf. Copy D: Employer Copy Retain for at least four years. 63

66 The Form W-2 Release and Direct Mail Process Submit the W-2 Release Form to authorize ADP to generate your company s Forms W-2. On the form, indicate if you would like Direct Mail for an additional fee. ADP generates Forms W-2 when your payroll service team receives the release form. ADP must receive the release form by January 25, 2017, for those who want Direct Mail. 64

67 Form W-3 Displays grand totals of the wages and federal taxes that the employer reported on the Form W-2 to which it is attached 65

68 Form 1099-MISC Description This form is used to report the following: Fees Commissions Payments for services rendered by individuals who are not employees Examples Contractors Consultants Freelance workers Independent agents 66

69 Form 1099-MISC (cont.) 67

70 Form 1099-R 68

71 Annual Statement of Deposits and Filings Is available in ADP SmartCompliance, which is prepared by ADP s Compliance and Payment Solutions Includes a section titled Annual FUTA Information and a computation of tentative credit for each state listed on your payroll 69

72 Annual Statement of Deposits and Filings (cont.) 70

73 Reconciling Payroll Information The payroll information that requires balancing throughout the year includes the following: Current payroll Tax deposits Quarterly federal tax deposits Unemployment tax deposits Annual Forms W-2 71

74 Reconciling Payroll Information (cont.) Current payroll: Verify and balance quarter-to-date and year-to-date information after each payroll process. Tax deposits: Verify and balance quarter-to-date and year-to-date deposits. Quarterly federal tax deposits: Compare tax deposit information with the quarterly Statement of Deposits and Filings or Form 941 to verify and balance figures. 72

75 Reconciling Payroll Information (cont.) Unemployment tax deposits: Compare the total wages reported with the state and the total wages reported on the Annual Statement of Deposits and Filings or Form 940 to verify and balance figures. Annual Forms W-2: Compare wages and taxes reported on Forms W-2 with the four quarterly federal Statements of Deposits and Filings for Form 941 for the year to verify and balance figures. 73

76 Reconciling Payroll Information (cont.) Master Control: Compare final year-to-date employee amounts with the amounts on the Wage and Tax Register and Form W-2. Statistical Summary: Compare quarter-to-date and year-to-date tax deposits with the Payroll Summary deposits. Wage and Tax Register: Compare year-to-date amounts with Form W-2. Also compare the fourth-quarter Company Totals page with the Annual Statement of Deposits and Filings or Form W-3. Quarterly federal tax deposits: Compare the sum of all four quarters with the amounts on the Annual Statement of Deposits and Filings. 74

77 How to Calculate Federal Wages, Tips, and Other Compensation Box 1: Wages, Tips, Other Comp. You calculate federal wages as follows: Gross earnings (including taxable fringe benefits and tips) federal tax exempt wages deferred compensation meals cafeteria 125 benefits (depending on benefit) + group term life + third-party sick pay (taxable portion) + other compensation = Wages, tips, and other comp. 75

78 Topic Summary ADP will generate Forms W-2 based on your input. Make time in your schedule to reconcile each payroll. ADP provides you with all of the documentation necessary to reconcile each quarter. If the payroll and quarters are not correct, your Forms W-2 will not be correct. Employees must receive their Forms W-2 by January 31, Use ADP s Direct Mail to send Forms W-2 directly to your employees. (An additional fee applies.) 76

79 Course Closing Objectives Now that you have completed this webinar, you are prepared to do the following: Reconcile quarter-end and year-end reports. Identify websites to access payroll and tax information. 77

80 Training Evaluation 78

81 Thank You! It was my pleasure to work with you today! 79