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Justworks handles all your payroll-related taxes so that you don’t have to. But, we can only do our job if you do yours. We’ve put together this article to help ensure your information is accurate so there are no surprises when tax season rolls around.
Quick glance checklist
At the end of each month (don't wait till the end of the quarter), check the following information is correct in your Payroll Report under Reports in your dashboard and your employees' Justworks' profiles:
- Employee basic data like name and SSN
- Employee classifications (FTE, PTE, contractor, temp)
- Work addresses (specifically for remote employees)
- One-off payment type classifications, like bonuses and commissions
- Payment amounts
- Employee filing status and withholding information
More detailed guidance
CHECK PAYROLL DATA MONTHLY
Justworks handles all your quarterly payroll tax filings for you, but we are only as good as the information you provide us. We know things change and want to be flexible, so we offer a one week window after quarter close to let us know of any adjustments before we file. Once that window is closed, we can’t make any further adjustments for the previous quarter.
Save time each quarter by checking that your employees’ payroll information is accurate at the end of each month. You can check this information in Reports > Payroll Report and in your employees' Justworks' profile. If you see any inaccuracies, change this information directly in the Justworks dashboard before running payroll. You’ll thank us later.
We’ve outlined the data that needs to be reviewed below.
1. BASIC EMPLOYEE AND CONTRACTOR INFORMATION
Make sure all these details are correct for employees and contractors:
- Name
- Social Security Number
- Address
- Contractor’s identification number (for contractors only)
Don’t forget, you need to check this information for both active and terminated employees!
2. EMPLOYEE CLASSIFICATION TYPES
Have any of your employees changed from part-time to full-time in the last month? Or, have you finally decided to bring that awesome contractor in-house? If so, you need to update their worker classification. Make sure the members of your team are correctly classified for the type of work they are doing.
3. WORK ADDRESSES FOR REMOTE EMPLOYEES
Each of your employees has a home address and a work address which are used to calculate applicable state and local taxes. If all your employees work at the same office location, then your office address will be their work address. Easy.
However, if you have any employees that work remotely, check their information under ‘Employment’ on the Justworks dashboard to make sure their work address hasn’t defaulted to your primary office address. Some states require withholding regardless of where you work so it’s super important that employee address details (for both home and work) are correct.
4. PAYMENT TYPES
Different payment types like bonuses and commissions are taxed differently. Make sure all employee payments are matched appropriately to the payment type.
For more information about making one-off payments like bonuses and tips, check out our article about One-off Payments.
5. PAYMENT AMOUNTS
It sounds simple, but it’s a surprisingly easy place to make mistakes. So when there have been salary changes, make sure to double-check the updated amounts.
6. FILING STATUS AND WITHHOLDING INFORMATION
Justworks collects your employees’ filing status, withholding and exemption information when they enroll with Justworks, so that they don’t need to file a W-4 themselves. It’s good practice for employees to update their W-4 information every time a major life event occurs like getting married or having a child. These events can have a direct effect on the amount of taxes owed so it’s important that your employees update this information whenever these change occur. This information can be updated under Account Settings>Finances>Filing Status in the Justworks dashboard.
If you or your employees are unsure of how to set up your withholdings, use this handy Withholdings Calculator from the IRS.
Changes to past payments
So you’ve read our best practices for running payroll and realize that you need to make some changes? Fear not. If you’ve incorrectly classified a payment or need to make changes to a payment that has already been made to an employee, we can help you make changes.
All you need to do is let us know the employee or contractor name, payment type, and date of payment. Please contact your Customer Success Manager or email support@justworks.com within the quarter that the payment was made and before the adjustment deadline.
For more information about taxes generally, check out our article about How Taxes Are Processed.
Disclaimer
This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, legal or tax advice. If you have any legal or tax questions regarding this content or related issues, then you should consult with your professional legal or tax advisor.