Payroll prep question

[joanmcq]

I do payroll for one client. He wants me to make the payments for the 941 & 940, as well as prepare the forms. I would do this through direct pay or EFTPS.

I declined doing this originally because of the liability; don't want to be a 'responsible party' for civil penalties, etc. of course, if I was to make the payments, there wouldn't be any penalties, etc. I already have access to the biz bank account to pay the employees.

What do you do for your payroll clients? Do you send payments or just prepare returns?

[Lee B]

I schedule payroll tax payments for close to half of my payroll clients via EFTPS and Oregon EFT.

I have reimbursed several clients over the years for penalties due to my mistakes.

Over time I developed a routine of doublechecking, so that it's been quite a while since I have made a mistake.

[RitaB]

I initiate payments thru EFTPS for most of mine. I've had to eat a penalty or two, but like cbslee, I'm pretty good now. Have my cheat sheet of companies for which I send payroll, sales tax, business tax. I put a check mark when I submit a payment, works for me. I prefer doing it over depending on the client to do it.

[Lion EA]

I like to use a third party for the liability issue, not make payments, not have authority to use their bank account.  In fact, I've usually suggested clients go directly to Paychex or whoever.  I have one (artist) where I enter the hours every two weeks and download the reports into a notebook for her.  But, everything is done by People's United Bank/Encore Online.  I still charge to oversee it all.  It's an immigration issue, so we want it correct with a good paper trail and no related parties; they're willing to pay for the outside third party payroll company as well as pay me a little bit too.  I don't like being tied down, and I don't like the large penalties.  As treasurer, I used to do our church payroll, but the national church made a package deal with Paychex, so that's off my shoulders.  With the People's system, I input her wages for the entire tax season in January so I won't have to deal with it until next week!

[rfassett]

I do payroll for one client. He wants me to make the payments for the 941 & 940, as well as prepare the forms. I would do this through direct pay or EFTPS.

I declined doing this originally because of the liability; don't want to be a 'responsible party' for civil penalties, etc. of course, if I was to make the payments, there wouldn't be any penalties, etc. I already have access to the biz bank account to pay the employees.

What do you do for your payroll clients? Do you send payments or just prepare returns?

 

I believe if you already have access to the biz bank account to pay the employees, I believe the "responsible party" issue is already in play.

 

We do a bunch of payroll (no direct deposit) on the client's checking account - but the client signs the checks.  We do not take signatory authority over  the account, nor do we impound funds for payroll taxes.  We schedule the EFTPS and other electronic payroll tax payments from the client's bank account after notifying them of the amount and day of withdrawal and getting the client's explicit approval to schedule the payment.  Occasionally a client has asked us to stamp his signature on the checks and our response has always been, "no thank you". 

[Catherine]

I do the same as Ron -- schedule payments & let the clients know when & how much.  I have NO signature authority.  A couple of clients I don't even have checks; I send a "paystub" that includes net check amount and they hand-write a check for the net amount and give the stub with all the withholding info.  One guy I print a check and mail it to the employee to bring to him for signature -- he's so flaky he kept *losing* the un-signed checks when I mailed them straight to him!  (Then once he used an old "I found it!" check and gave that to the employee in place of the one for that week which he had lost.  That caused no end of trouble with check numbers and dates etc and he got read the riot act and the checks started going to the employee.)

[rfassett]

I do the same as Ron -- schedule payments & let the clients know when & how much.  I have NO signature authority.  A couple of clients I don't even have checks; I send a "paystub" that includes net check amount and they hand-write a check for the net amount and give the stub with all the withholding info.  One guy I print a check and mail it to the employee to bring to him for signature -- he's so flaky he kept *losing* the un-signed checks when I mailed them straight to him!  (Then once he used an old "I found it!" check and gave that to the employee in place of the one for that week which he had lost.  That caused no end of trouble with check numbers and dates etc and he got read the riot act and the checks started going to the employee.)

 

We use three up blank check stock for paychecks.  The software prints everything on that including the pertinent info on the stub which includes year to date numbers.  One stub is left attached to the check and the other is for the client's files.  The software prints the client's banking info, client's name and address, etc, on the check.  It even prints a line for the signature.  I just ordered in 4,000 sheets of blank check stock and that should last us the rest of the year.

[ILLMAS]

This is what I dislike about payroll, when a client does not pay your fees and you are forced to discontinue services for non-payment.

[rfassett]

This is what I dislike about payroll, when a client does not pay your fees and you are forced to discontinue services for non-payment.

 

I don't seem to have that problem.  I will let payroll clients go 30 days on what they owe me and then I shut them off (with warning).  Usually the warning is all it takes.  I only have this problem about once a year.  Payroll is a nice profit center for us.

[ILLMAS]

I am going on 5 months without payment, but I stopped doing their payroll in March 2015.

[RitaB]

What I hate about payroll is when clients get QuickBooks and think they now understand payroll taxes. (Or any taxes, or bookkeeping, or anything, for that matter.) I am working on the 990 and awaiting the 2014 payroll reports from a non-profit that apparently thought my $85 per quarter to do reports after summarizing their payroll data was too much. I wonder when it will dawn on them that the QuickBooks updates will cost more than having correctly prepared reports.

[rfassett]

What I hate about payroll is when clients get QuickBooks and think they now understand payroll taxes. (Or any taxes, or bookkeeping, or anything, for that matter.) I am working on the 990 and awaiting the 2014 payroll reports from a non-profit that apparently thought my $85 per quarter to do reports after summarizing their payroll data was too much. I wonder when it will dawn on them that the QuickBooks updates will cost more than having correctly prepared reports.

 

In a sense I agree with you!  On the other hand, I have made a lot of money over the years, bailing these folks out.  I have lots of clients that used to think they could do it themselves.  The thing that I hate most is that interim period when they do not want you to do the work (nor pay you for it) but think nothing about calling you up for free advice.  Now that is what gets my blood pressure up.  In fact, just thinking about it gets my blood pressure up.  Look out dog, I am looking for something to kick!

[RitaB]

Oh, yeah, nothing aggravates me like a DIYer calling me for advice. Or messaging me on FaceBook. Or chasing me down at church. Nothing.