Do Not Pay Employees Early
Tax payments and reporting are based on Pay Date. Giving out paychecks early can lead to lots of penalty and interest if it causes taxes to be due on an earlier date. Banks will cash post dated checks so you cannot rely on that to stop employees from being paid early. Do not allow employees to cash checks before the actual Pay Date – Do not hand them out early.
Example: You are a monthly tax payer so payroll taxes are due the 15th of the following month. Payroll is processed for the Pay Date 4/1. Taxes for the payroll will be due 5/15. You hand out paychecks on 3/31. Employees cash their checks on 3/31. The taxes for the checks cashed will now be due 4/15!
Do Not Deduct without Written Consent
It is unlawful to deduct anything but taxes and garnishments without written consent from employees. This includes loan pay backs, reimbursement for personal expenses/purchases, and insurance premiums. Signing up for medical insurance is not enough, employees need to sign a wage reduction agreement stating that they agree to have premiums deducted from their pay.
BOLI Employer Deductions: Questions & Answers
Do Not Enter What You Do Not Need/Know
The new versions of QuickBooks have fields in Employee Information for Race, National Origin, and Marital Status. Making assumptions is never a good idea and filling in these fields can be an even worse idea. Do not fill in data for protected classes unless you need the data for reporting to a third party.
Information about inclusion in protected classes should be kept confidential. Entering this information in QuickBooks means anyone with access to QB, has access to the information. Employees may rightly assume that their protected status is in some way being used to make decisions about their employment if you are tracking the status in QB.