Posted by James Financial Services Inc

What Are Quarterly Payroll Reports & Why Are They Important?

What Are Quarterly Payroll Reports & Why Are They Important?

Wage reports, also known as quarterly contributions or payroll reports or wage detail reports, are sent quarterly to each state, district, and territory in which you pay employees to meet state unemployment insurance payments (SUTA). In other words, they are an essential function of payroll taxes (also called employers' taxes).

When should quarterly payroll reports be submitted?

The short answer is quarterly. Although the months covered for each quarter are standardized, the states may vary depending on the effective expiration date.

Other things to know for quarterly reports include:

  • State payroll reports follow the same schedule as IRS Form 941, the Quarterly Employer's Quarterly Federal Tax Return.

  • If the due date for the report falls on a weekend, as usual, the report will be due the next business day.

What if my federal wage reports are due at the same time as my state wage reports? What should I do first?

Good question. If you can believe it, the answer is simple. We recommend that you submit detailed state payroll reports first because if you pay your state unemployment tax act (SUTA) on time, the FUTA (Federal Unemployment Tax) rate of 6.0% can be reduced to as low as 5.4%.

What is the SUTA rate in the state (s) in which I do business?

The state you conduct your business in will also present their specific tax rates based on your unemployment insurance claims. 

Where do you send the state wage reports?

Your quarterly wage reports are sent to the appropriate state labor department or a similarly appointed authority responsible for monitoring unemployment. This is the same agency you sign up with to get your business's state unemployment tax identification (I.D.) number. 

What are the main parts of a wage report?

To complete and send a wage report, you will need to provide:

  • A complete list of your employees, including those for each employee:

  • Federal Employer Identification Number (FEIN) and corresponding state identification number.

  • First and last name.

  • Quarterly gross wages (amount before taxes and deductions).

  • Social security number (SSN).

  • Some states may also require taxable and non-taxable wages.

What happens if I don't send my state wages reports?

Nothing good will come of it. If applicable, you will be fined, and your employees will not have the information necessary to claim unemployment insurance. Remember that your FUTA tax is also affected by the SUTA tax. SUTA will trickle up and force you to owe more to the IRS if you don't comply.

What happens if I make a mistake on a wage report?

Mistakes happen. If you forgot to add an employee or entered the wrong amount, there is a process for change. Again, exactly how this works is determined from state to state. But the big picture is, the faster the problem is resolved, the better.

How can tax experts or payroll software help you with quarterly wage reporting?

Tax experts and small business payroll software help you gather the information you need to complete your reports by automating payroll tax calculations and deductions. Many providers can help you pay and report payroll taxes. 



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