By Steve Kania of SurePayroll
There is a large amount of documentation related to payroll that must be kept on file, according to federal requirements. Employment records, IRS forms, state and local tax records, Social Security and Medicare data are all part of the trove of payroll information that needs to be retained. Another factor is the amount of time they need to be retained. Here’s a list of some of the main requirements:
• Occupation Safety and Health Administration records – 5 years
• IRS & Social Security Administration records – 4 years
• Fair Labor Standards Act and Immigration Reform and Control Act records – 3 years
• Family and Medical Leave Act records – 3 years
• Supplemental records including time cards – 2 years
The state also has its own set of requirements regarding state income tax, unemployment insurance tax, wage and hour, and other state-mandated requirements. Some states even require businesses to keep documentation longer than the federal government.
While it can be cumbersome, it’s important your clients keep these records to help protect their businesses from audits and lawsuits.
The easiest way to maintain detailed payroll records without a hassle or lots of storage is an online payroll service. A good service will allow you to keep all of your payroll reports and employee data stored on the Cloud, secure and easy to access.