Making the most of the features that can be provided to users of W-2/1099 software will help you to simplify your consequences of filing a late form. The Internal Revenue will issue W-2 penalties if an individual or small business fails to:
- File an accurate information return by its deadline
- Send accurate payee statements by the deadline
Filers can avoid separate penalties for each of their information returns when they get reliable software that helps them file correctly and on time. Many W-2/1099 programs offer electronic filing options to send documents directly to the appropriate agency.
There is a less than 1% error rate for e-filed returns compared to 21% for paper returns.
Advanced Micro Solutions’ base W-2/1099 Forms Filer program is the most affordable program on the market for individuals and small business users who are interested in handling their own W-2 form submissions. The core product provides users with different module interactions so a filer can submit year-end W-2 and 1099 forms right to the IRS or Social Security Administration.
Common Pitfalls that Lead to Form W-2 Penalties
Forgetting to file W-2 forms on time is not necessarily uncommon, yet the following common pitfalls are avoidable with the right W-2/1099 software.
- Limited or inexperienced staff
- Low-tech or manual filing
- Confusion about requirements
- Missing data or information
- Procrastination
Limited or Inexperienced Staff
Relying on a part-time bookkeeper or yourself to handle submitting W-2 forms and/or any other necessary operations can become risky. It is easier than you may think to overlook deadlines if the person responsible is:
- Busy
- Focusing on other tasks
- Unfamiliar with the filing process
Low-Tech or Manual Filing
Reporting or filing your tax forms manually is a recipe for losing information and potentially costly inaccuracies. Comprehensive software will help you to avoid incurring W-2 penalties, while additionally minimizing the risk of:
- Inaccessible documents
- Missing information
- Omitted year-end reports
Look for a W-2 software system that works for you and automates each step of the process at an affordable price.
Confusion About Requirements
It is best not to make any assumptions about the Internal Revenue Service. Knowing what the agency expects of you is your responsibility, whether you are filing your own personal taxes or handling reports for a business. Do not assume that:
- Information return deadlines are flexible
- Employers only need to send forms to their employees
- Employers only need to send forms to the IRS and/or SSA
Missing Data or Information
Not having the right data or information about yourself or someone else is a common problem that can complicate any tax season for filers. Make sure that you track down up-to-date:
- Social Security numbers
- Name changes
- Address changes
Whether you are missing information for an employee or your employer sends you a form with missing or inaccurate information, trustworthy software can flag certain inconsistencies.
Procrastination
Try not to let the holiday season distract you so much that tax filing season sneaks up on you. Waiting until you only have a couple of weeks to gather and distribute the necessary forms is when many people encounter surprise deadlines and inconvenient late filing penalties.
What are the Best Practices For Filing W-2 Forms?
Software and keeping good tax filing practices may not prevent you from running into W-2 form late filing penalties. What it can do is make the occurrences less common and less severe.
Small business filers should:
- Utilize automated payroll software
- Centralize how they store data
- Reconcile payroll on a quarterly basis
- Confirm employee information prior to holiday breaks
Individual filers should:
- Prepare early for the upcoming tax season
- Provide up-to-date information for employers
- Create a list of all employers in a given year
- Speak with an employer about how to access W-2s once they are available
Is AMS Software Worth It?
As a small business, we understand that W-2 penalties or penalties of any kind can significantly harm or overwhelm taxpayers. Reliable support from the software and its provider are essential features that individuals and small businesses will not overlook.
Download our free 1099-etc Demo software to gain a quick and solid understanding of our program and how it can simplify your W-2 filing process.
Our team of experts is available to provide support and clarify any software questions that arise. The affordable and almost fully functional version of our system will help you determine whether you simply need the core product or want to expand it to include a full-accounting suite of tools.
Our six optional add-on modules are:
- AMS Payroll
- Software Generated Forms
- E-File
- Forms Filer Plus
- Affordable Care Act Filer
- 1042-S Filer