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How To Prepare For Year-End Accounting And Payroll

Ensuring compliance with various reporting requirements and forms is crucial when preparing for year-end accounting and payroll. Below is a summary of important forms and tasks generally associated with year-end accounting and payroll:

 

Payroll Tax Forms

 

  • W-2 Form


Deadline: January 31

Purpose: Report wages, tips, and other compensation paid to employees and the tax withheld. Employers must provide Form W-2 to employees and submit it to the Social Security Administration (SSA).


  • W-3 Form


Deadline: January 31

Purpose: Transmittal of W-2 Forms. This summary reports the total earnings, Social Security wages, Medicare wages, and withholding for all employees.


  • 1099 Forms (specifically 1099-NEC and 1099-MISC)


Deadline: January 31 (for 1099-NEC; February 28, or March 31 for e-filing for 1099-MISC) 

Purpose: Report payments to non-employees, such as independent contractors.

 

Federal Tax Forms

 

  • Form 941


Deadline: Quarterly, but for year-end, reconcile the last quarter. Due for Q4: January 31

Purpose: Report income taxes, Social Security tax, and Medicare tax withheld from employee's paychecks.

 

  • Form 940

 

Deadline: January 31

Purpose: Report and pay Federal Unemployment Tax (FUTA). If due February 10 file Form 940 based on employment tax obligations.

 

State and Local Tax Forms

 

  • State Income Tax Withholding Forms - Each state has its own deadlines and forms for employees’ withholding tax. Check with your state’s Department of Revenue or equivalent for compliance.

 

  • State Unemployment Tax (SUTA) Forms - Similar to FUTA, states have their own unemployment tax forms that usually align with the business's specific requirements.

 

Additional Compliance Tasks

 

  • Document Review and Reconciliation - Ensure all payroll records are complete and accurate, reconcile any discrepancies, and verify employee classifications.

 

  • Year-End Bonuses and Adjustments - Ensure year-end bonuses are accounted for and accurately reflected in payroll.

 

  • IRS Compliance - Review IRS publications and updates for any relevant changes to tax rates or compliance requirements for the tax year.

 

Internal Accounting Forms

 

  • Year-End Closing - Make all necessary journal entries for revenue, expenses, and payroll corrections before closing the books.

 

  • Financial Statements - Prepare and review year-end financial statements including the balance sheet, income statement, and cash flow statement.


Conclusion


Each business may have additional requirements based on its unique situation, such as specific industry regulations or local requirements. It’s always advisable to consult with a certified public accountant (CPA) or tax advisor to ensure full compliance with all applicable regulations. This will help avoid potential penalties and enhance compliance efforts.


Reach Out for Help


Everyone deserves a supportive team of people who care. Cloud Bookkeeping Inc.’s team provides monthly bookkeeping and accurate financial reports. We’ll give you financial visibility throughout the year and deliver insights to make strategic business decisions

 

Get in Touch with Us for Our Services

 

We don’t just say it, we deliver – our work speaks for us! Contact us for 30 minutes of free consultation and opt for our Online Bookkeeping Service.

 

Cloud Bookkeeping, Inc. 

(Our Office Addresses)

1. 3281 E. Guasti Road, Suite 700

Ontario California 9176

 

2. 5000 Birch St., West Tower,

Suite 3000 Newport Beach, CA 92660

 

Tel: +1 (909) 952-3804


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