When setting up your payroll account with GoCo’s embedded payroll, it’s important to provide accurate historical payroll data. This data helps ensure compliance with tax regulations, corrects payroll discrepancies, and avoids issues with year-end reporting. Here’s an overview of what to prepare and what GoCo will do to ensure your payroll records are accurately set up.
Why Reporting Historical Payrolls Matters
Accurate historical payroll reporting is crucial because employers can issue only one W-2 per employee per calendar year. Providing a record of your payrolls from the current year allows embedded payroll to calculate year-to-date taxes, deductions, and contributions accurately. This W-2 will be filed on behalf of your company, by GoCo Embedded Payroll, your current payroll provider.
What Data to Gather
You’ll need to collect payroll data from both the current and previous quarters in the calendar year to set up embedded payroll. Here’s what to provide:
- Current Quarter: Gather a CSV payroll register for each pay event, which details earnings, deductions, reimbursements, and taxes.
- Previous Quarters (Same Calendar Year): Collect quarterly payroll summaries in CSV format, showing itemized earnings, deductions, and taxes for each employee.
How GoCo Will Use Your Data
Once you’ve gathered this data, here’s how we’ll use it to ensure your embedded payroll is set up accurately:
- Payroll Journal and Summaries: We’ll use the payroll journal you provided to confirm employee earnings, deductions, and contributions. This data helps us establish a correct starting point for year-to-date totals.
- Check Date and Pay Period: The check date determines the payroll’s reporting quarter, which affects tax liability. We’ll verify each payroll’s check date to align with tax requirements.
- Tax Rates for Social Security and Medicare: GoCo will calculate Social Security and Medicare taxes at flat rates of 6.2% and 1.45%, respectively. We’ll cross-check these rates with your provided payroll data to ensure consistency.
Common Mistakes to Avoid
To make the setup process as smooth as possible, please double-check the following before submitting your historical payrolls:
- Check Dates vs. Pay Periods: Ensure each entry has the correct check date, which determines when taxes are due.
- Data Mismatches: Confirm that the earnings, deductions, and employer contributions in your reports match the paystub data. If there are discrepancies, hold off on submission until they are resolved.
- Reimbursements and Exemptions: Non-taxable reimbursements should be noted separately, and tax exemptions should be listed during employee setup to ensure accurate tax calculations.
Reviewing Before Submission
Before finalizing your historical payrolls, please ensure:
- Each employee’s wages, taxes, and deductions align with their paystubs.
- Exemptions and reimbursements are accurately reflected.
- Social Security and Medicare amounts match the expected totals.
If you have questions at any point, please reach out to our team at support@goco.io. Your preparation helps us get your embedded payroll set up smoothly and accurately! 💚
Published 11.5.2024