If you’re like most small business owners, you outsource payroll processing. And that includes filing payroll tax returns and making payroll tax payments.
That’s a smart move!
As a small business owner, you wear many hats. You must stay on top of the details but can’t do it all yourself. So outsourcing things like payroll makes sense.
Still, the ultimate responsibility for ensuring that tax returns are filed, and payments are made on time stays with you.
That’s why it’s a wise business practice to check up on your payroll company occasionally and make sure tax payments are made as you expect. Here’s how.
One of the ways to make federal tax payments is through the Electronic Federal Tax Payment System (EFTPS). It’s also a way to check on the status and history of tax payments.
Here are the steps to confirm that your payroll tax payments are up-to-date using the EFTPS website (https://www.eftps.gov/eftps/).
Step 1: Register for EFTPS: If you haven’t already, you must register your small business on the EFTPS website. To do this, visit the above website and click the “Enrollment” button. Follow the instructions, and ensure you have all the necessary information, including your Employer Identification Number (EIN) and business details.
Step 2: Log into your EFTPS account: Once successfully enrolled, you can log into your EFTPS account using your EIN, Personal Identification Number (PIN), and Internet Password. These credentials will grant you access to your account and all associated tax payment information.
Step 3: Review your payment history: Navigate to the “Payment History” section after logging in. You’ll find a detailed record of your past tax payments here. Look for the payroll tax payments made during the relevant periods and verify that they align with your payroll schedule.
Step 4: Check the payment dates: Ensure that the payment dates for your payroll taxes coincide with the deadlines set by the IRS. Typically, payroll taxes are due on a monthly or semi-weekly schedule, depending on the size of your payroll. Comparing your payment dates to the IRS schedule will help you identify missed or late payments.
Step 5: Verify the payment amounts: Double-check the payment amounts to ensure they are accurate and in line with your tax liabilities. Miscalculations or underpayments can lead to penalties, so it’s essential to be diligent in verifying these figures.
Step 6: Confirm payment statuses: Next to each payment in the payment history, you’ll find a status indicator (e.g., “Processed” or “Posted”). A “Processed” status means the EFTPS has accepted the payment, while a “Posted” status indicates that the IRS has received and credited the payment. Ensure all payments are marked as “Posted” to confirm that the IRS has received your payroll tax payments properly.
Step 7: Set up payment reminders: If you make the payments yourself, set up payment reminders on your EFTPS account to avoid missing future tax payments. You can receive email notifications a few days before your scheduled payment dates. This will help you stay organized and manage your payroll tax responsibilities. And if you outsource payroll, set up reminders to verify payment status on a regular schedule.
Keeping your payroll tax payments up-to-date is essential to running a compliant and successful small business. Utilizing the EFTPS website provides a secure and efficient way to manage your tax payments and ensure you meet all IRS deadlines. Following the steps outlined in this blog post, you can confidently confirm that your payroll tax payments are up-to-date, allowing you to focus on growing your business without worrying about tax compliance issues. Remember, it’s always a good idea to consult with a tax professional if you have any doubts or questions regarding your tax obligations.