Outsourcing Payroll Duties

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<br>Outsourcing payroll tasks can be a sound service practice, however … Know your tax obligations as a company<br>
<br>Many companies outsource some or all their payroll and related tax responsibilities to third-party payroll service providers. Third-party payroll service providers can improve company operations and help satisfy filing due dates and deposit requirements. Some of the services they supply are:<br>
<br>- Administering payroll and work taxes on behalf of the company where the company offers the funds at first to the third-party.
– Reporting, collecting and transferring employment taxes with state and federal authorities.<br>
<br>Employers who outsource some or all their payroll duties need to think about the following:<br>
<br>- The company is ultimately responsible for the deposit and payment of federal tax liabilities. Although the employer might forward the tax amounts to the third-party to make the tax deposits, the employer is the accountable celebration. If the third-party stops working to make the federal tax payments, then the IRS may assess charges and interest on the company’s account. The company is accountable for all taxes, charges and interest due. The company might likewise be held personally accountable for particular unsettled federal taxes.
– If there are any issues with an account, then the IRS will send out correspondence to the employer at the address of record. The IRS highly recommends that the company does not alter their address of record to that of the payroll provider as it may considerably restrict the employer’s ability to be notified of tax matters involving their business.
– Electronic Funds Transfer (EFT) should be utilized to transfer all federal tax deposits. Generally, an EFT is made using Electronic Federal Tax Payment System (EFTPS). Employers should guarantee their payroll companies are using EFTPS, so the employers can verify that payments are being made on their behalf. Employers should sign up on the EFTPS system to get their own PIN and utilize this PIN to regularly verify payments. A red flag must go up the very first time a company misses out on a payment or makes a late payment. When an employer registers on EFTPS they will have online access to their payment history for 16 months. In addition, EFTPS allows employers to make any additional tax payments that their third-party company is not making on their behalf such as approximated tax payments. There have been prosecutions of individuals and companies, who acting under the look of a payroll provider, have taken funds planned for payment of work taxes.<br>
<br>EFTPS is a safe, accurate, and easy to utilize service that provides an immediate verification for each deal. This service is offered complimentary of charge from the U.S. Department of Treasury and permits employers to make and verify federal tax payments electronically 24 hours a day, 7 days a week through the web or by phone. For additional information, employers can enroll online at EFTPS.gov or call EFTPS Customer care at 800-555-4477 for a registration type or to consult with a customer care agent.<br>
<br>Remember, employers are eventually responsible for the payment of income tax withheld and of both the company and staff member portions of and Medicare taxes.<br>
<br>Employers who think that a costs or notification received is a result of an issue with their payroll service company ought to contact the IRS as quickly as possible by calling the number on the costs, writing to the IRS workplace that sent the expense, calling 800-829-4933 or checking out a regional IRS office. To find out more about IRS notices, expenses and payment alternatives, refer to Publication 594, The IRS Collection Process PDF.<br>

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