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7 Types of Payroll Reports for Employers

Payroll requires you to organize time sheets, calculate deductions and calculate and distribute net pay, but your employer responsibilities don’t end there. Once you’ve processed payroll, you need to prepare and file payroll reports to the appropriate government agencies. Understanding what a payroll report is and how to file is important for avoiding penalties and maintaining compliance.

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What is a payroll report?

A payroll report is a document completed and submitted to the appropriate government agency, such as the IRS, to notify it of your payroll and employment tax liabilities. Some reports document taxes that you contribute as an employer as well as taxes withheld from employees pay, such as income tax, Social Security and Medicare tax amounts.

Completing payroll reports can help you detail and analyze your payroll costs and accuracy and ensure that you maintain compliance with government regulations. Payroll reports typically include the following information:

  • Employee wages
  • Employee hours worked
  • Withheld federal income tax amounts
  • Withheld state income tax amounts
  • Medicare tax
  • Social Security Tax
  • Reported tips
  • Unemployment taxes
  • Any other withheld tax amounts

Types of payroll reports

Depending on the reported information, payroll reports are made to federal, state or local governing agencies. Some taxes are reported separately while others may be combined on a single form. Payroll report due dates vary according to the report type, but they’re usually due on a quarterly or annual frequency.

Federal payroll reports

Federal payroll reports are filed with the IRS either quarterly or annually. There are a few different reports that you’ll need to file, so take a look at the following breakdown.

Quarterly payroll report: Employer’s quarterly federal tax return

Employers that pay wages subject to income or other taxes are required to complete and file quarterly payroll reports. This report is known as Form 941, or the Employer’s Quarterly Federal Tax Return. Federal law requires employers to withhold taxes from employees’ pay. Every time you pay wages to an employee, you withhold tax amounts according to that employee’s W-4. You also withhold FICA amounts, which include Medicare and Social Security taxes. Along with amounts withheld from employees, federal law also requires employers to pay their share of Social Security and Medicare taxes.

The following information should be included on Form 941:

  • Wages paid to employees
  • Tips reported by employees
  • Withheld federal income tax
  • Employer and employee Social Security and Medicare taxes
  • Additional Medicare tax withheld from employees
  • Other information relating to benefit and credit amounts

After the first time you file Form 941, you must electronically file or send a return by mail for each quarter. The deadlines are:

  • April 30 – Quarter 1
  • July 31 – Quarter 2
  • September 30 – Quarter 3
  • December 31 – Quarter 4

Annual payroll reports

Other reports are due on an annual basis. You may not need to complete all of these. These reports include:

  • 944
  • 940
  • W-2
  • W-3

Form 944 or the Employer’s Annual Federal Tax Return is an alternative to Form 941. It reports employee wages and withheld tax amounts, but it’s designed for employers whose annual tax liability is $1,000 or less to file annually instead of quarterly. Some employers may receive notification from the IRS to file Form 944 instead of Form 941, but you can also request to file with Form 944 in future years if you estimate your tax liability to be low enough. Don’t file Form 941 if you file Form 944. The deadline for filing is January 31 each year, and it can be completed electronically or by mail.

Employers use Form 940 to report annual FUTA or unemployment tax. This amount isn’t deducted from employees’ pay and instead is paid directly by employers. You have to file Form 940 if you meet either of the following conditions:

  • Paid $1,500 or more in wages to employees in any calendar quarter
  • Had employees for at least part of a day in any 20 or more weeks

Some employers may be eligible for FUTA exemptions. If not, Form 940 must be filed by mail or electronically by January 31 each year.

Form W-2, or the Wage and Tax Statement, is required from any employer who had one or more employees they made payments to in a given tax year. The form must be completed for every employee you paid during the previous year. It includes information about the employee’s annual wages, tips and withheld taxes. Form W-2 must be filed with the SSA and your state, city or municipal tax department by January 31 each year. A copy must also be sent to the employee.

Form W-3, or the Transmittal of Wage and Tax Statements, is a document that summarizes W-2 forms. It must be submitted to government agencies along with the W-2s you file.

State and local payroll reports

In addition to federal payroll reports, employers may be obligated to file state or local payroll taxes. Depending on the location of your business, how much or how often taxes must be filed or paid will vary.

State payroll reports

According to where your business is located and operates, you may be required to file payroll reports with the state. This may be on an annual or quarterly basis for state income and unemployment tax. In California, for example, wages are subject to four state payroll taxes, including unemployment insurance, personal income tax and disability insurance.

Keep in mind that due dates may not necessarily align with federal deadlines. Check with your state to ensure you know which payroll reports to file and when they’re due to avoid noncompliance and any penalties.

Local payroll reports

As with state payroll reports, some local government agencies may require employers to remit payroll taxes and file certain payroll reports. Check with your local government to ensure you’re complying with its requirements and filing deadlines.

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