Most of us are busy counting down the final days of 2020. We are preparing for holiday festivities. Business owners may not be thinking about upcoming payroll tax due dates. Nor are they thinking about regulatory obligations.
However, 2021 will be here before we know it! Business owners may want to prepare for three important payroll tax due dates that begin in just a few weeks.
PaySmart has Compiled a List of Upcoming Payroll Tax Due Dates That Small Business Owners May Want to be Mindful of.
Three Upcoming Important Payroll Tax Due Dates Not to Be Ignored Include:
1. February 1st, 2021
- State Withholding – Employers are required to withhold and remit taxes on behalf of their employees. State Withholding due dates are specific to its respective state.*
- State Unemployment – Like state withholding, state unemployment is withheld and remitted on behalf of their employees. Almost all states have a due date of February 1st.*
- Federal Form 940 – The employer must pay (FUTA) Federal Unemployment Tax as part of its tax responsibilities.
- Federal Form 941– This form records income taxes, Social Security tax, and Medicare tax withheld from employees’ paychecks. Form 941 also includes the employer’s portion of Social Security and Medicare tax.
- Local Taxes – Typically, local taxes are remitted quarterly. This particular tax can be tricky. To ensure accuracy, there may be value in contacting an experienced local payroll provider, such as PaySmart.
- W-2 (employee and social security) – Employers issue this form to all employees. This includes employees that may be terminated but generated earnings in the previous year.**
- 1099 NEC & MISC – It is required that employers are to issue these forms to any applicable subcontractors in which taxes were not deducted.**
2. March 2nd, 2021
- Form 1095-C – Some employers are required to provide health coverage. Those employers that are required to provide insurance are required to issue this form to their employees.
- Form 1095-B – The insurance carrier issues this form to applicable employees.
3. March 31st, 2021
- 1099-forms- Businesses that make nonemployee compensation payments totaling $600 or more to at least one payee must report those payments and withholding. This is submitted to the IRS. A 1099-MISC or 1099-NEC will need to be filed, respectively.
- 1094-C –Transmittal of Employer-Provided Health Insurance Offer – Employers with more than 50 full-time employees are required to file this form with the IRS.
*For more information on the 940 Form, State Withholding, and State Unemployment, including due dates, contact PaySmart today.*
** F.A.Q. on 1099 Form/s**
TIP: Businesses may want to require new vendors to fill out a W-9 before issuing any payments. Your organization will be able to identify the business entity. The vendor’s business entity (sole proprietor vs. corporation) determines whether or not a 1099 form will need to be issued later.
Here are a few questions that many business owners have:
Question: Who needs to be issued a 1099-MISC form?
Answer: Business owners commonly are unsure of who needs to receive 1099s. They often neglect to issue these forms. Businesses issuing payments to landlords and property managers, attorneys, awards, and prizes, will need to issue the 1099-MISC form. New this year is the 1099-NEC, make sure to use the proper form for the proper payment type.
Question: Which vendors require a 1099-NEC to be issued?
Answer: Independent contractors paid over $600 for the year are required to be issued a 1099-NEC. This is a change to previous years and is a new form. More information can be found on the IRS website.
Question: Which vendors do not require 1099 to be issued?
Answer: S-Corps and C-Corps do not get issued a “1099.”
Question: Are 1099s filled out online?
Answer: Visit the IRS website to learn more about requirements (paper vs. electronic).
**F.A.Q. on W2’s Form **
Employees may begin asking when they can expect to receive W-2s as early as the first or second week of the New Year. Employees who anticipate receiving a refund often are eager to file their income tax returns. This past year, workers who have faced illness and or financial hardships may be more anxious than ever to file their tax returns in expectation of receiving a refund.
Question: What can we do to eliminate W-2s being returned for wrong addresses?
Answer: PaySmart recommends communicating regularly with employees to ensure that your employees’ addresses are accurate. Our existing clients can work with their employees to make these updates very simple. The business owner can execute this task with little effort.
Question: What else can be done to prepare the W-2s and reduce errors?
Answer: PaySmart also performs additional quality checks. This includes verifying social security numbers before issuing W-2s on behalf of our clients. This eliminates a lot of potential hassle, and our clients appreciate this extra step.
Many Businesses Have Found Security and Peace of Mind Turning over the Important Responsibility of Payroll and Payroll Tax Due Dates to a Locally Owned and Operated Payroll Service Provider.
Small business owners often attempt to process payroll themselves. There are so many different forms that need to be filed to different government agencies. Business owners often are confused as to which deadlines apply to them. This tends to get overwhelming. A small mistake such as forgetting a filing could impact the business adversely. Fines and late fees may be issued.
PaySmart works with organizations as small as one employee. We have every option that you could think of to make payroll work for you and your company! Business owners appreciate the opportunity to focus on their business without the hassle or concerns of issuing W-2s and filing quarterly returns.
Now is an ideal time to consider transitioning payroll and payroll taxes!
We appreciate the opportunity to discuss your payroll needs. PaySmart is here for you as a fellow local, small business owner. Our office looks forward to hearing from you. We would be honored to provide a no-obligation quote today. PaySmart takes care of the issuing of payroll. We alleviate the burden of filing forms, including the three important upcoming payroll tax due dates in this article.
PaySmart is a payroll provider located in Mechanicsburg, Pennsylvania, supporting small businesses in the Central PA region. We are dedicated to helping small businesses take care of their payroll needs. To learn more information about how PaySmart may provide payroll solutions, please contact us at 717-766-1777. Our New Client Concierge is waiting for you!