2014 Year-End Guide Dominion Payroll Services (DPS) would like to take this opportunity to thank you for your business and to wish you a happy holiday season and a prosperous New Year. Please review this year-end guide carefully to ensure that you are aware of any and all action items that may affect your company. Following the guidelines and meeting the deadlines in this guide will allow us to ensure accurate year-end reports and timely filings with the various tax authorities. www.dominionpayroll.com
Dear Friends of Dominion Payroll Services, It is that time of year again year-end is upon us! This document is a crucial part of our fourth quarter and year-end education process and will help guide you smoothly through a successful end of the year. Please read this document carefully and respond to us with any adjustments and notifications as soon as possible. As always, if you have questions that are not addressed in these documents or need further clarification, you may contact our Richmond Operations Office at customerservice@dominionpayroll.com Thank you, The Dominion Payroll Services Team Table of Contents Important Deadlines and Holidays Pg. 3 How to Review Employee Information and Schedules Pg. 4 Vacation, Sick, PTO review Pg. 5 1099 Miscellaneous Forms Pg. 5 Bonus/Holiday Checks Things to Consider Pg. 5 Do s and Don ts Pg. 6 Health Care Reporting on W-2 Pg. 7 Tax Changes for 2015 Pg. 7 State Unemployment and Deposit Frequency Notices Pg. 7 W-2 and 1099 Deadlines Pg. 8 End of Year CD Pg. 8
DOMINION PAYROLL SERVICES Important Deadlines for Year-End December 12 Review year-end guide and respond with any changes or adjustments December 30 Last day to process 2014 payrolls January 23 W-2 s and 1099 s delivered to clients no later than this date. Upcoming Holidays November 27 Thanksgiving; DPS and banks are closed. December 24 DPS hopes to close at noon. December 25 Christmas Day; DPS and banks are closed. January 1 New Year s Day; DPS and banks are closed. January 19 Martin Luther King, Jr. Federal Holiday; DPS and banks are closed. Important E-mail Addresses Customer Service customerservice@dominionpayroll.com Tax tax@dominionpayroll.com Year-End Adjustment Processing Deadline Please notify us no later than December 13, 2014 of any year-end payroll adjustments. This will provide sufficient time to record adjustments prior to your last payroll of 2014. We understand that some information related to closing your 2014 payroll records may not be available by this date, but keep in mind that reporting adjustments after your last payroll in 2014 could delay your 4th quarter and year-end returns as well as causing additional processing fees. Examples of adjustments are as follows: Void and/or manual checks Third party sick payments Fringe benefits Year-end distributions Bonuses and other gifts given to employees Heath Insurance Premiums (only for employers with 250 or more W-2s filed in 2013, due by Jan. 15, 2014) Vendor 1099 payment recording 3
DOMINION PAYROLL SERVICES How to review and confirm accuracy of your company and employees information Employee W2 Information Internet clients (using Paychoice Online): 1. Log into the Payroll module. 2. Select Web Reports. 3. Select Emp W2 and SSN. 4. Select to open the report in PDF, Excel, or Word. 5. Print and review the report. 6. Make updates in Paychoice Online prior to processing your final payroll of 2014. Non-Internet Clients: Contact Customer Service. (customerservice@dominionpayroll.com) Incorrect information can affect your employee s W-2 filing and social security wage benefits as well as cause additional fees for corrections made after the 2014 payroll year has closed. ACA Reports If your company filed 250 or more W-2s in 2013, you will be required by the IRS to report the amount of money paid in medical insurance premiums for your employees on each of their W-2s. Please consult Box C of your 2013 Form W-3 to confirm the number of W-2s filed in 2013 so that you can prepare to report premiums if necessary. If your company employs 50 or more full-time equivalent employees (FTEs), ACA requirements will go into affect for your business starting in 2014. Review your employee count to ensure that you are aware of your status. If you do employ 50 or more FTEs and need more information regarding ACA and how it affects your business, please contact our customer service department for resource recommendations. Payroll Schedules for 2015 Schedules are determined based on your current company policy but can be thrown off when holidays occur and when check dates fall on weekends. 2015 schedules are available for review now. Internet clients (using Paychoice Online): 1. Log in to the Payroll module. 2. Select Payroll. 3. Select Dates. 4. Select View Company Schedule. 5. Select to open the report in PDF, Excel, or Word. 6. Print and review the report. 7. Notify DPS of any changes that need to be made. Non-Internet Clients: Contact Customer Service. (customerservice@dominionpayroll.com) 4
Vacation, Sick and/or PTO Balances The system default is that all employee vacation, sick, and PTO balances will be reset to zero after the first payroll in January unless prior communication regarding carry-over has been received. If you have communicated your carry-over preference in past years, your balances are set to carry forward accordingly. If you have not carried forward balances in past years but would like to start doing so this year, please communicate this information to us by sending an email to customerservice@dominionpayroll.com prior to the end of December. 1099 Miscellaneous Forms If you have paid 1099 miscellaneous income through the payroll system in 2014, DPS will produce these forms. If you have additional 1099 s (for vendors or contractors who were paid earlier in the year and not reported), enter them using manual adjustments before you process your last payroll for 2014. Always use 1099 Earnings codes to pay 1099 contractors and/or vendors in the payroll system to ensure that the 1099 tax forms are generated properly. Special Payrolls Many companies issue bonus checks and other supplemental wage payments in December, and these checks can be run with a regular payroll. If a separate payroll check date or period end date is desired, the bonus checks must be run on a separate payroll. You can also issue live checks for bonuses instead of direct deposit. This can be done by stopping direct deposit for the entire company for a specific payroll or by stopping it on individual checks. Bonus/Holiday Checks Checklist How will you enter the bonus pays? Hand-keyed Spreadsheet import Other DOMINION PAYROLL SERVICES How are you scheduling the bonus payroll? Combined with normal pay Separate checks on a normal pay run Separate payroll with same check date Separate payroll with different check date How will the employees be paid their bonuses? Cash Live Checks Direct deposit Who will cover the taxes on the bonuses? Employee (start with gross pay, calculate net) Employer (start with net pay, calculate gross) What deductions will you take from the bonuses? Social Security taxes only All taxes All taxes + retirement plan deductions Other When should employees see the electronic stubs for the bonuses? When payroll runs On check date Other 5
Void Checks DOMINION PAYROLL SERVICES DOS AND DON TS Topic Do Don t Do void fourth quarter checks on or before your last payroll process for 2014. Do not void prior quarter checks. Send a note to the customer service team to let them know about prior quarter checks to be voided. Manual Checks Address Changes Payroll Calendar Verification 1099 master file information 1099 Information Payroll Tax Information Group Term Life (GTL) Third Party Sick Pay Fringe Benefits Do enter them on or before your last payroll process for 2014. Do make all address changes on or before your last payroll process for 2014. Do verify payroll processing schedule/calendar by 12/12/2014. Do review the following reports under Web Reports and Company Setup for online clients: Emp W2 and SSN Report Employee W-2 Verification Report Tax IDs and Rates Internet customers enter online/ non-internet clients submit to Processing Department before you process the last payroll of 2014. Internet customers enter online/ non-internet clients submit 1099 earnings to the Processing Department before you process the last payroll of 2014. Do send all payroll tax documents received from federal, state and/ or local tax authorities to the Tax Department. Do enter on or before your last payroll process for 2014. Send all 3rd Party Sick Pay to customer service with or before your last payroll process of 2014. Do report any additional fringe items on or before your last payroll process for 2014. 6 Do not enter negative manuals for prior quarters without consulting a DPS service representative. Do not enter GTL on terminated employees or use manual adjustments for 2014 figures after the last 2014 payroll. Call DPS for instructions. Do not enter manual adjustments after the last 2014 payroll process. Send them to the Customer Service department for processing.
Health Care Reporting on W-2 Requirement for Large Employers If your company filed more than 250 W-2 s in 2013, the ACA W-2 reporting requirement applies, and you are responsible for reporting the total costs (regardless of employee-paid portion vs. employer-paid portion) of health insurance on their 2014 W-2 s. Typical costs to include are those paid on behalf of the employees for group health insurance plans. For more detailed explanation of these items, please refer to the IRS website [1]. Since this information may not be available until after the close of the 2014 calendar year, we ask that you compile a list of the employees and their premiums in January of 2015 and send us the spreadsheet by January 15th so that we can add those values to your W-2s. IRS Notes for 2015 FICA Social Security will remain at 6.2%. DOMINION PAYROLL SERVICES Medicare tax rate steady in 2015 at 1.45 % up to $200,000. For wages over $200,000, an additional 0.9% applies to the employee portion only, making the percentage 2.35% for wages over $200,000. This 0.9% increase only applies to the employee Medicare portion of the Federal Insurance Contributions Act (FICA) tax. Consequently, employers do not have to match the increased Medicare tax amount from employee s wages. NOTE: The employer is required to withhold the increased amount from all workers with wages exceeding $200,000, regardless of the marital status claimed on the employee s Form W-4. Over- and under-withholding for the employee will be reconciled upon the filing of his/her tax return. Social Security Tax Wage Base increase: In 2014, that maximum is $117,000. It will rise in 2015 to $118,500. 401k contribution limits: Increased to $18,000 with catch-up of $6,000 for employees age 50+. Simple IRA contribution limits: Increased to $12,500 with catch-up of $3,000 for employees age 50+. State Unemployment Rate and Deposit Frequency Notices for 2015 You should receive your 2015 state unemployment rate and your state deposit frequency during the next two months. Once you receive these notices, please fax them to us at 804.355.3432 or email them to the Tax Department (tax@dominionpayroll.com). This will ensure the accuracy of your tax liability calculation and timely deposits of the associated taxes. [1] http://www.irs.gov/pub/irs-drop/n-12-09.pdf 7
DOMINION PAYROLL SERVICES W-2 and 1099 Deadlines W-2 deliveries will begin Monday, January 12th. W-2 s will be shipped to your offices no later than January 23rd. The forms will be in a separate package labeled W-2. If you are a paperless client, we will deliver paper W-2 s to your delivery address on file. 2014 End of Year CD In February 2015, you will receive a CD with all of your 2014 payroll information. The disc contains: Reports of every payroll run, quarterly returns, employee check stubs, and copies of all W2s and 1099s. As an employer, you are required by law to retain copies of all payroll information for seven (7) years. The CD archival fee ranges from $49 to $199, depending upon the amount of data included in the archive (related to the size of your company). If you choose to opt out of this service, please let us know in advance by sending an email to customerservice@dominionpayroll.com stating your client code and that you decline the CD archival service. 8