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Payroll Processing Tax Guide Clean Year Start

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Therese Montecalvo

on 10 October 2016

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Transcript of Payroll Processing Tax Guide Clean Year Start

List of Contacts
Pam Ramacciato, VP Payroll Services
Email: prama@groupmgmt.com
Phone: 330.659.0130
Payroll related changes (direct, on-going deductions)
Tax related changes (tax mail, W4 changes, SUTA rate changes)
Government-issued items (child support orders, garnishment orders, income verifications)
New Client Coordinator
Email: ncc@groupmgmt.com
Payroll set up
Web training
Run first payroll
Account Manager
Human Resources and employee relations items
Implementation of BWC Programs (DFWP, PDP)
Creation of company handbook and job descriptions
Help clients maintain safe and compliant workplace.
*Once you run payroll your A.M will contact you
General Emails:
NCC: ncc@groupmgmt.com
Payroll: payroll@groupmgmt.com
HR: am@groupmgmt.com
When you first join GMS, we are given a list of contacts for payroll with your company.

These are the people that we are authorized to speak with regarding payroll and/or payroll changes.
*Please do not give out your GMS payroll processor's contact information directly to your employees as they will be referred back to you.
1, 2, 3 Step Process
1. Payroll Submission
You will be trained on how to submit payroll through GMS' payroll web system. The deadline for this is always 3:00pm, three business banking days prior to your pay date.

Payrolls submitted after 3PM three business days before the pay date will have the date date bumped forward 1 bank business day.
3. Payroll Approval
After previewing your reports you have two options:

1. You may approve your payroll as it is for processing OR

2. You can postpone your payroll and enter your changes in the comments box before it is processed.
2. Payroll Review
You are notified via email when your payroll is available on the web for review. You will learn how to utilize the payroll review tab during your web training.
-Each pay period, GMS will sweep your payroll account for the total invoice amount 2 business banking days prior to your pay date.

-Payrolls submitted after 3pm on your run date will have the pay date bumped forward 1 bank business day unless other arrangements have been made with your processor.

-Should the full invoice amount not be available, your Account Manager will contact you with instructions to wire the funds for payroll.

-Our bank charges GMS for each returned item; a 3% charge will be added to your next invoice to cover these costs.
Payroll Invoice
Pay Date
Funds Must Be Available By:
12:00am Wednesday
12:00am Tuesday
12:00am Monday
12:00am Friday
12:00am Thursday
*You will see the full invoice amount during the payroll review process prior to the sweep of your account. At this time, if you need help in understanding your invoice, please contact your New Client Coordinator to walk through this with you.
GMS strongly encourages all clients to utilize the payroll web system when making employee, payroll, or HR related changes.
Utilizing the Payroll Web System
You will receive a 1.5 hour training during your setup, highlighting the following tasks that you can complete using our system:
Please feel free to log onto our demo website to preview what is in store for your web training:

in the top right corner click on "employer login"
username: GMSDEMO
password: GMSDEMO1

Direct Deposit
GMS will only accept direct deposit information from a new client on GMS direct deposit or Global Cash Card forms.
Checking Accounts
Pre-printed checks (please do not use starter checks or deposit slips. Write the word VOID on the check.) Another options is a written letter signed by your bank with account and routing numbers.
Saving Accounts
Bank direct deposit form or a written letter signed by your bank with account and routing numbers.
*The payroll department uses account and routing numbers to electronically transfer payroll funds directly to your account.
- Failure to verify accuracy of account information with your financial institution will cause delays or improper transfer. If a deposit is returned to GMS due to incorrect information or a closed account, we will deduct a $3 bank fee to your next pay.
- If you are a Paperless client and you do not have this information to your New Client Coordinator by the first payroll run, you will have to pay $50 shipping fee for each payroll run until we do receive the proper direct deposit information.
Garnishments, Child Support Orders, and Income Verifications
GMS Payroll will handle the administration of employee garnishment and child support orders. For each garnishment/order, the employee will have an additional deduction of $2.00 for administration as allowed by state law.
Should you receive new or updated garnishments or child support orders please fax them directly to your payroll processor's attention. With our co-employment relationship, we will periodically receive these orders directly and send copies for your records.
GMS Payroll will also handle the completion of various income verification paperwork frequently sent by City, State, and County agencies. Please fax any of these forms directly to your payroll processor for completion.
Understanding Your Payroll Taxes with GMS
If you join GMS any time other than January 1st of a given year, you need to understand what the transition will be for each type of tax.
The liability to file taxes
switches from your Federal ID number to GMS's Federal ID
number commencing the first check date with GMS. GMS assumes responsibly to file all Federal, State, and Local withholding taxes from that day forward.
State unemployment stays on your unemployment ID.
GMS is allowed to file a return on your behalf. The return must be filed with your unemployment number. You are responsible for reporting any rate changes received from ODJFS or any other state's unemployment agency to a GMS representative.
If all of the members of a multi-member limited liability company that has not elected to be treated as a corporation are individuals, the members shall be treated as partners. Services performed by a family member of any individual member of the limited liability company shall not constitute covered employment with the limited liability company if the relationship of each individual member of the limited liability company to the family member meets the requirements of division (B)(3)(f) of section 4141.01 of the revised code.
Please double check with your paid accounting service if you have any questions about this ruling.
Your W2’s will have GMS’s name on them not your company name.
They will be mailed directly to the employee’s home.
Once processed, you may obtain copies of your employees’ W2s for any year processed with GMS through the website.

Your W2’s from the prior year will still need to be issued by your former payroll company.

You must contact your payroll manager if you need an alternate delivery method. W2’s will be made available to you at the same time we send them out to the employees. Check the GMS website in January for W2 availability.

Filing Your 941
You or Your prior payroll company should mark this form as final in Part 3, number 16.
Enter the last check date with your prior payroll company.

You can also file a zero return while you are with GMS. This zero return should have box 4 checked and box 16 checked with a date in the next one. This will alleviate future notices from the IRS.

Filing Your 940
You/or your prior payroll company should also mark your 940 as final.

You can also file a zero return while you are with GMS.

Follow the same suggestions as above.

Local Taxes from the Prior Year
Local Tax
Employees are subject to local tax for where they physically work and where they reside. Employers
withhold and remit tax for where the employee works, but has the option to collect local tax for where they live. Taxes are based upon gross wages minus Café 125 deductions. Reciprocity is a term that describes the taxing relationship between jurisdictions where an employee works and lives. Some residential jurisdictions will allow a credit if an employee pays tax to a jurisdiction in which he/she works.
1. An employee works in a local where he/she pays 2% of gross wages.
2. He/She also lives in a 2% local.
3. If the residential local offers a 50% max credit, the employee is required to pay 1% of gross wages to the city they live in.

If eligible, your Workers’ Compensation coverage with GMS begins on the
day of your first payroll run not on the day that you signed the contract. Anything before that first check date is your responsibility to pay.
GMS begins reporting payroll to the BWC as of the date of your first check run.
All other States
If you are on GMS’s Non-Ohio Policy we will collect your premium for your Workers’ Compensation coverage which begins on the day of your first payroll run. GMS begins reporting payroll to the BWC as of the date of your first check run. However, we do not manage any non-Ohio claims.

If you are on your own out of state policy GMS does not collect any premium and it does not manage any claims.

Workers Compensation
Owner/Officer Caps
If you are Full to GMS then you are no longer considered an officer of the company and cannot take a cap. If you are fully on your own policy you can take a cap.

: Fully on your own policy or if you are under a manual class that stays under your policy (partial transfer).

: If you are fully on GMS’s policy or if you are under a manual class that is under GMS’s policy (partial transfers)

Health Care
GMS can’t make payments on your behalf unless we are the agent of record for your healthcare plan. If you stay with your current health care agent from another company we will credit back the money that was deducted from your employee’s paychecks (if applicable) on your invoice each payroll. You will see this amount under the “Agency Credits” line. You will be responsible for making the payments each month. If you would like GMS to administer this then you can either give us the Agent of Record or sign up for GMS healthcare. If this is something that you are interested in please notify your NCC or Account Manager.
Section 125
If you currently have any pretax benefits that are being deducted from your employee’s checks we will need a copy of your Section 125 plan (or the first 9-12 pages which is the adoption plan) in order to continue to deduct those as pretax.
If you do not provide this to us before your first payroll run, these deductions will be taken as post-tax until we can receive a copy of the plan
. If you want a plan from GMS we are able to create one for you/or update your current plan if it has not been updated in the last few years (updated with the new ACA rules).
The IRS and DOL require it in order to get the pre-tax benefit. Tax law requires a section 125 plan in order to receive the tax benefit. If the client is audited and no plan exists, then the agency will go back and assess the employees and employer for back taxes and penalties.
You/your accountant or your prior payroll company should close out each of your locals that you worked in the prior year. You can do this by sending a letter to each agency stating that you are no longer running payroll under your own federal id.
Each letter must be signed and mailed to each agency to avoid potential tax notices, penalties and interest. Your new client coordinator can provide you with a generic letter that you can customize and mail out. You or your paid accounting firm are still responsible for any license or profit tax requirements.

State of Ohio:

You, your accountant or your prior payroll company should also close out your State Withholding ID. You will need to fill out a change of status form and mark your IT-941 as final and send it in to the state.

Stop Check Fee

When an employee check is lost, a stop payment is processed and a replacement check is issued. Even though GMS has stopped payment on the check, current Uniform Commercial Code Regulations (3.302 and 3.305) protect Cash Checking Services as “Holders in Due Course”. If the lost/stopped check is presented at a Check Cashing Service, GMS is required to honor the check, even though it has been reported lost and stopped. It is required of the client to inform their employee not to try to cash the lost check if found.
If this were to happen, GMS will invoice the client for the duplicate payment and it will be the responsibility of the client to obtain restitution from the employee. Please also note that stop pays require a $100.00 charge. This fee may be waived with the agreement that your entire staff be mandated to direct deposit by your next scheduled payroll.
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