Year End Bonuses:
With the end of the year almost here, we know that many of you will be running bonus pay runs for your employees and wanted to take the time to clarify some rules regarding these payrolls. Many times, the bonus payroll can exceed your pre-approved direct deposit limit. Please be aware that in some cases when the amount exceeds your limit, a wire may be required to pay your employees by the date of your choice. Also, keep in mind that bonus runs qualifying for the IRS Next-Day Rules (page 3) (i.e. runs resulting in $100,000 or more in 941/944 tax liability for a single semi-weekly period) must be run five business days before the check date. If you wish to run those bonuses for a date of December 31st, please complete the run no later than December 21st so we have time to properly draft the funds. If you cannot provide enough time to draft, you may be required to wire those funds to OnPay or be given the choice to deposit those with the IRS directly. Any bonus payroll run that results in a Next-Day amount that is run on December 31st after 12 PM EST will not be paid until OnPay receives your funds. This could result in a large penalty and interest notice from the IRS.
Many of you will be adding 1099 contractors you have paid throughout the year to your OnPay account. Please make sure that all 1099s are run in the system prior to year-end to ensure they can be dated correctly. OnPay will not be able to process 2017 1099s if the corresponding payroll is not run prior to year-end.