Payroll Tax Reporting

So now that tax season is over, I've got to catch up my bookkeeping clients. I only prepare a couple of sets of payroll tax reports for clients, but I am pretty sure that I must start electronically filing them since they submit over 10 forms per year (ie 941's, 940's, TR's, quarterly reports, W-2's and 1099's). This has slipped up on me. Looks like it can take up to two months to get authorized for this as a reporting agent. Has any one else recently done all of this? If so, how long did it take?

I use drake accounting and efile the 941’s and 940’s via drake

I only have a handful of these but I don't think the 941s/940 need to be filed electronically, just the W2s/1099s.

Check out Tax Bandits. You’ll have an extra hoop to jump through initially but it will be relatively painless.

Maybe your payroll software vendor has a way you can do it, with the right paperwork , until you get approval.

It was pretty quick for me but I applied in the year 1BC. My handful of payroll clients almost universally accepted the extra step without complaint. The one who didn’t is sucking the life-blood out of someone else now.

I only have a handful of these but I don't think the 941s/940 need to be filed electronically, just the W2s/1099s.

I hope you are right, but that was not my understanding. Guess I need to look into it a little more.

Sumwun, am I correct that you have to get signed 8655's from the clients and send to the IRS in order to file 941's electronically? Is that what you do? Thanks for the Tax Bandits tip. I pay so much for software already, hate to add to that cost with something else when my software will handle it. Although I honestly think Accounting CS is the most awkward, user un-friendly software there is! Something that should be so simple in that program to change can take forever to figure out!

Rbynaker, I think you are correct that the payroll tax reports do not have to be filed electronically. I was reading somewhere that employment tax returns were included in some of the items that were counted to determine if 10 or more forms were filed. I think that is what confused me.

Seaside, the 8655 will let you file without getting a signature from the client every time. There is also an 8879 series form that you need to get signed every time. It is the latter where Tax Bandits is good. The several payroll software I’ve looked at don’t offer that option. So I’d see it as a temporary fix until you get the nod from the IRS.

I am in my second year of outsourcing payroll to SurePayroll. It starts at $40 per month per employer and that gets you two employees. I raised my payroll processing fees to cover the costs but I make zero profit from payroll and I’m fine with that. I don’t do payroll without monthly accounting. My payroll work consists of entering payroll, sending pay period reports, printing off the quarterlies and printing and mailing the W-2’s. I am amazed at how much quality time I saved. It’s the few minutes here and there that add up and hurt efficiency.

SurePrep reliable and do they respond with actual answers if issues arise? I want to phase out all payroll processing (do about 6 internally via QBD, all for routine clients). Gusto was my go-to for referring out payroll but they have turned out to be another company that cannot maintain service quality relative to growth.

It was my understanding 941s and 940s need to be eFiled, too, if the 10 threshold was exceeded, but I was already doing it through QBD. 1099s is what presented some difficulty this year. Being approved by IRS is not that difficult, I did it through same application as EFIN. But, like EFIN, I believe the PIN is associated to a specific address so keep that in mind if you change work locations. I then require all payroll clients to sign Form 8655.

You get what you pay for, Cornerstone. SurePayroll will handle the basic stuff like SEHI and retirement contributions. It can’t do multiple pay periods automatically. I have one client with an employee. Employee is paid every two weeks. Officer gets paid monthly, on the first payday of the month. For that run, I have to do a monthly check with monthly withholdings (which it calculates accurately) then delete his fortnightly check.

SurePayroll gets an 8655 in their favor but they encourage you to keep the EFTPS account active and to check it regularly.

I only handle after-the-fact payroll reporting. I prepare the quarterly reports for a few clients. Trying to get out of that completely, so haven't been offering it to any new clients. I spend way too much time trying to figure out how to do what is required electronically than it is worth. I had to file my first corrected 1099 this week, and still haven't been able to send it electronically yet. This was my first year remitting 1099's and W-2's electronically, so spent tons of time on that as well. To say Accounting CS is not user-friendly is an understatement.

Cornerstone, I thought that about the 941/940's as well. Now, in reviewing the regs, I don't come to that conclusion. Hope I'm not missing something!