Are you a small or mid-sized business holder? Or an entrepreneur?? You should take a gaze upon the frequent QuickBooks Payroll and Bookkeeping Mistakes. Suppose if you present the gift card to the business employee’s & reckon them as a cash payment. Are you sure that you have a fast and easy payoff system for the taxes whilst you overpaid the employees?
It might be possible that you are using the vendor payments as payroll before receiving the Form W-9? If you don’t, then IRS would probably penalize you with some serious fines. Now read this technical article to avail complete insight on this topic. To learn further about this, make sure to stick around till the end, or you can get in touch with our QuickBooks support team of certified accounting professionals, who can help you with all your accounting and bookkeeping activities. Give us a call at ++1-844-964-2960, and get answers to all your queries.
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Avoid 11 Common QuickBooks Payroll and Bookkeeping Mistakes
Avoid these 11 common payroll and bookkeeping problems that small company holders tend to make.
1. Failure to Issue Form 1099 Correctly
Be sure that Form 1099 be supposed to be issued only to self-governing or independent contractors & also to the vendors who endow the business with over $600 in services. If you fail to do so, you could tend to steep penalties.
2. Classify Employees as Independent Contractors
Your staff members may usually be either independent or self-governing contractors or employees. Selecting the correct classification is essential. Different forms are involved (1099 versus W-2), & some staff may be subject to tax preservation.
3. Proper Fringe Benefit Value Not Included Appropriately
You can take into account company cars, spousal travel, country club fees, and also housing benefits into the Taxable Fringe benefits. But it can be complicated to analyze fringe benefit value accurately.
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4. If You Are Not Including the Fair Market Value of Prizes, Gift Cards, and Awards in Employee Income Totals
The majority awards are noticed as a taxable fringe benefit & the Gift cards are identified as cash should be assumed as a taxable wages.
5. Excluding Travel and Commuting from Employee Income
In numerous cases, commuting & travel expenditures are not measured as taxable income for a worker. But there are a number of unique cases such as travel expenses for short-term coursework that lengthened can be subject to income tax.
6. If You Are Doing It All Alone
There is a crisis with small business owners & entrepreneurs. They at all times struggle to deal with payroll tasks on their own. But they end up experiencing more pressure, stress, and may make costly errors.
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7. Exclude Reimbursements for Expenses from Re-portable Wages
The correct exclusion of reimbursements for expenses depends upon an accountable plan where operating costs are reimbursed. Only if there is a business relationship, other reimbursements should be built-in in the taxable salary.
8. Executive Income is Not Including in Non-qualified Deferred Compensation
Here is the thing that maybe Executive compensation is a subject matter to an excise tax. You be familiar that if this is neglected, there is a relief program. But only certain oversights are eligible.
9. Neglect Backup Withholding for Vendor Payments
You probably know this very well that a company pays the vendor before receiving the Form W-9 (Request for Taxpayer Identification Number and Certification). It could be subject to a payment of 28 percent for backup withholding.
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10. Not Depositing Withheld Taxes in a Timely Manner
Withheld taxes are supposed to be deposited in regular payment terms on a semi-weekly or monthly basis. However, some amounts need a deposit on the next business day. If you are unable to deposit it appropriately…! This can lead to late fee deposits, penalties, and also interest charges ranging from two to 15 percent.
11. Thinking your way through the task
Entrepreneurs will as a whole theory their way via accounting when they aren’t entirely specific what they’re doing. The problem is mystery mixes after time, potentially leaving a year of books that you have to fix at evaluation time.
Few Examples include:
- Not categorizing costs properly
- Overlooking tax deductions
- Missing filing on declaring target dates since guides weren’t done in a timely manner
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In case, you are also facing some unnecessary penalties from the IRS – you should Hire a professional bookkeeping service to handle your business payroll tax concerns and reporting…! Because the bookkeeping services give you tension-less accounting experience and also help you to grow your business.
To know more on QuickBooks Payroll and Bookkeeping mistakes or to hire a specialized bookkeeper for your business – you can dial our toll-free QuickBooks payroll helpline number with no hesitation .i.e. ++1-844-964-2960. Our Certified accountants and bookkeepers are ready there to help you out with your accounting and payroll related problems. We have covered a large area all over the USA and other countries.
FAQs Related to Payroll and Bookkeeping
A common mistake that might be seen in payroll can be miscalculating pay. Poor time tracking capabilities can contribute to miscalculated pay. Moreover, if the company doesn’t have a reliable way to track employee hours or paid time off, then your chances of making a payroll overpayment or underpayment mistake skyrocket.
A few common bookkeeping mistakes include:
1. Not hiring an experienced bookkeeper and professional accountant
2. Improper record-keeping of financial transactions.
3. Inaccurate categorization of income and expenses.
You can simply perform the below steps:
1. In the show paychecks from and through, enter the paycheck date.
2. Choose the paycheck that has the incorrect pay period and double click to open.
3. Once done with that, choose paycheck detail.
4. In the review paycheck window, enter the correct pay period dates.
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