Payroll

Sorry, but no one told you a remote employee moved to another state, so you just kept withholding for the employee’s old state. This employee just received a W-2 reporting wages for the wrong state. How do you fix this? Is it fixable at all?

The earlier you fix errors on your 2024 W-2s, the less likely it is you’ll suffer a stiff penalty from the IRS. Here’s the scoop.

Way back in the dim mists of antiquity, the IRS embarked on a campaign to reclassify independent contractors as employees, sticking employers with huge tax bills. In response, Congress added Section 530 to the Revenue Act of 1978. As a result, the IRS was forbidden from publishing regulations or revenue rulings with respect to the employment status of any individual for purposes of payroll taxes. But this doesn’t mean the IRS can never issue guidance interpreting Section 530.

Here’s your monthly guide to critical payroll due dates.