Business Tips for Managing W-2 and 1099 Reporting
Tax software developer Greatland Corporation is offering some tips to businesses to help them manage W-2 and 1099 reporting.
The company, which develops software for those purposes, and the speedEfiler.com Web-based wage-reporting tool, offers business owners the following tips for taking some of the stress out of year-end W-2 and 1099 reporting:
• First, resist the temptation to do it all. Business owners often know they will have to wear many hats, but this doesn't have to be one of those times. There are some simple and affordable options for outsourcing W-2 and 1099 reporting, as well as resources that will guide you through the process of doing it yourself.
• If you don't keep track throughout the year, go through your accounting and payroll records to determine which recipients are due to receive a Form 1099. Doing this prior to year-end or in early January can reduce the amount of time it takes to figure it all out and file at crunch time.
• Verify you have correct personnel records, including the correct mailing addresses and social security numbers. Give employees and contractors an opportunity to update their mailing addresses. Consider reminding them via e-mail or by printing a message on their check stub. If you are still missing information from contractors, use Form W-9 to collect the data.
• Bring all general ledger accounts postings up-to-date and reconcile those that impact wages, taxes and business expenses.
• Take the weather into account when considering all government filing due dates. If you think bad weather could keep you away from work, and therefore prevent you from filing, try to submit the forms a few days early in order to be timely and take the pressure off.
• Before completing Forms W-2 and 1099, be sure to read the first page of the instructions where the IRS provides information on any new or changed reporting requirements for the year.
• Finally, measure twice, cut once. That's sage advice when it comes to home improvement projects, but the same principle applies when it comes to W-2 and 1099 reporting. Take the time up front to do a thorough data review and save yourself time – and potential fines – on the back end.
Greatland also reminded business owners that the deadline to have Forms 1099 and W-2 to contractors and employees is Jan. 31, 2012—meaning forms must be mailed and postmarked on or before this date.