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Common Payroll Mistakes

September 17, 2023
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If you’re running a small business and are starting to see more growth that requires hiring more staff, you may be feeling the stress of managing the payroll. The more employees you have, the more time you spend on payroll and the more mistakes it’s easy to make. That’s why we recommend you use Gonzales Group payroll services in San Antonio to let you focus more on running and growing your business.

One of the first errors you may make, depending on your business, is a simple matter of classification, whether your staff are employees or independent contractors. This matters because you need different tax forms for each, be it a W-2 or a 1099 tax form.

It’s also important to be clear about an employee’s status of exempt or non-exempt according to the federal Fair Labor Standards Act. This creates requirements regarding overtime and minimum wage. Violation of this act can cause serious financial and legal problems.

With more remote employees this day, there are additional issues, particularly if they live out of state. Your business must be incorporated in the state where your employee works. You’ll need to request relevant tax forms with their addresses, which can be even more time-consuming and confusing if they move around and have multiple addresses.

Make sure you have set paydays, whether it’s every week, every two weeks, or every month. Don’t forget to adjust for holidays should the payday fall on one.

Finally, when possible, try to get your employees to use direct deposit as there are less likely to be mistakes made this way, especially compared to paying by hand-written check.

Of course, keeping highly organized records is also a must when handling payroll, which is yet another reason for payroll services in San Antonio by Gonzales Group. We can help you ensure your payroll records are organized, on time, and meet all necessary requirements so you can keep your attention on your business. Contact us today to learn more.

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This post was written by Gonzales Group CPA


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