Payroll Recording Service in Teaneck | Capgro Bookkeeping

Helping business owners gain financial clarity, improve cash flow, and increase profitability.

What's Covered on This Page

• What a Payroll Recording Service Does
• New Jersey Payroll Recordkeeping Regulations that Small Businesses in Teaneck Shouldn't Ignore
• How Payroll Records Are Created and Kept For Each Pay Period
• If Your Payroll Recording Service Records Are Backdated, Missing, and Out of Order
• Teaneck Businesses that Have Workers in NY with Multi-State Payroll Records
• How long does New Jersey require Teaneck businesses to keep payroll records?
• What exactly gets recorded during each pay period?
• What happens if I've been posting one bulk payroll amount instead of a full breakdown?
• Can payroll records affect how my workers are classified as employees or contractors?
• Do you break out payroll costs by job site or project for Teaneck contractors?
• What's the risk of tracking weekly hours but not daily hours in New Jersey?

Need payroll recording service?

973-453-5052

Book A Free Consultation. Call Capgro Bookkeeping Services LLC now.

What a Payroll Recording Service Does

Most business owners assume that recording payroll means simply documenting the total dollar amount of employee checks, but it's more nuanced than that. Payroll recording services track the total amount paid to employees and deposit it into its appropriate account in your company ledger. Gross wages, tax withholdings, employer contributions, and net pay must go to separate accounts in QuickBooks, and an error in one account could compromise the rest.

Every week, we see this happening to a Teaneck contractor. For example, a plumber might pay three employees for the week on Friday and log the total wages as a single debit to an expense account. This miscalculation distorts his company's profit-and-loss statement and tax liability. At the end of the year, his accountant is likely to spend several days cleaning up his payroll records. With the proper recording of payroll, this would never happen.

The Payroll Records Our Bookkeepers Post

During each pay period, here is the kind of data and accounting our bookkeepers post to your chart of accounts:

• Gross wages by employee and job to allow proper project cost calculation
• Tax withholdings from employee paychecks posted to liability accounts
• Social security and Medicare contributions by employers posted as separate line items
• Payroll deductions for insurance premiums, garnishments, or 401(k)s and other benefit plans
• Net pay amounts are reconciled with actual payroll withdrawals in your bank account

Each of these transactions corresponds to a specific value on a payroll stub or bank statement. We never estimate or aggregate any of this data. Plus, if you manage crews on job sites in West Englewood and other areas in Teaneck, we break down payroll labor expenses by project so you can measure the profitability of each job.

Beyond accuracy, we verify that payroll accounts are correctly recorded in your company's balance sheet and that payroll liabilities are up-to-date. In fact, when the majority of clients come to us for a payroll recording service, they do so because of poorly kept books as a result of bulk payroll posting for months on end or no recording at all in between.

To put it simply, your payroll affects your expenses, your cash flow, and the payroll liability amounts in the general ledger. This, in turn, affects the accuracy of your federal, state, and local tax filings. A single accounting error creates multiple problems for your company. It's our job to make sure those don't exist so that any bookkeeping reports you generate or any questions your tax preparer asks you about your payroll records have an accurate answer.

New Jersey Payroll Recordkeeping Regulations that Small Businesses in Teaneck Shouldn't Ignore

While every business in Teaneck knows they need to about the hours worked and amounts paid by employees, many do not know what specific payroll information they are required to record. [QuickBooks Setup]

New Jersey states that companies must keep payroll records for no less than six years. Some of our clients mistakenly assume this is a reference to the federal recordkeeping standard, which only requires three years of records per the Fair Labor Standards Act (FLSA), and discard their files too soon. When the Division of Payroll Services in the New Jersey Department of Labor comes knocking at their doors to request past documentation, these firms are scrambling to find the needed info.

What Records Must Be Saved?

Besides payroll registers and check stubs, state law specifies that the following documents must be kept by New Jersey employers. Here is what your payroll recording service files need to have for every employee:

• Full name, address, and Social Security number
• Hours worked both per day and per week
• Gross pay, all deductions, and net pay per pay period
• When each payment was made and what pay period that payment covered
• Benefits, tips, and any supplemental pay

If one of those categories is missing, you could get penalized if your business is audited by the state. And it's not as though audits don't happen; they happen all too frequently to Teaneck and West Englewood and Glenpointe companies that employ a crew of five to 15 people.

Common Mistakes We See

It's the exact same thing. A contractor is tracking the total of hours in a week but not the hours per day. New Jersey needs both. Or they're tracking the gross pay but not the details of how much was deducted. That's an issue if an employee ever files a wage complaint.

Another mistake we see all the time: employees are labeled 1099 contractors instead of W-2 employees. The state has tightened up its enforcement on this. If you don't have documentation that substantiates the way that you're classifying people, you're potentially liable for back taxes and interest.

We had a plumbing company after getting a notice from the NJ Department of Labor. Their old bookkeeper had been recording one big amount per month, with no breakdown of individual days and no individual amounts deducted. Fixing three years of those books took a number of weeks. But that shouldn't have to happen.

If your records are currently lacking,. With twenty-plus years of accounting experience, exactly what you're looking for to keep Teaneck businesses compliant with the state. If your QuickBooks isn't properly set up to record these details, that we can do.

How Payroll Records Are Created and Kept For Each Pay Period

What many business owners don't realize is that there are many moving parts to every pay period; it's not simply to write the checks. It needs to be recorded with the hours, the taxes withheld, any deductions, and contributions from the employer, then that all goes into the proper accounts for your books.

This happens every single week. They use the payroll records from a provider, but they're not recording them in QuickBooks. Six months later, the books are a mess, and no one knows whether an amount represents profit or what the business owes to the IRS.

This is how payroll recording service works for each pay period:

1. We'll obtain the payroll summary from your provider once the period is complete.
2. We'll record gross wages, employer payroll taxes, and all the benefit deductions as separate line items.
3. We'll record the journal entry in QuickBooks Online, with each dollar in its proper account.
4. We'll reconcile the accounts of your payroll liability with what your provider deducted from your bank account.
5. Finally, we'll flag any anomalies, whether that's a missing payment or some sort of tax deposit.

That last piece is often overlooked. Those small differences can quickly add up. Before long, you're looking at a bill and maybe even a tax season headache.

It's Not Just Wages. We Track Other Things, Too.

Wages? Yeah, that's the first thing. The next steps are to account for employer portions of FICA, federal and state unemployment contributions, and any retirement match you provide. If you're near Glenpointe and managing a crew of five or more employees, you're looking at an extra 10-15% of your total payroll. You need to be aware of those totals as soon as you post each payroll.

Here's what keeps things organized versus a mess. Each category is its own line item. You don't get one big payroll entry that you need to pull apart later when the accountant is running end-of-year reports. You'd know your true labor cost on that roofing project a few weeks ago in a flash.

And that's why the books stay in order. You maintain the books every pay period. You never miss a step.

Need help with payroll recording service?

973-453-5052

Book A Free Consultation. Capgro Bookkeeping Services LLC is ready to help.

If Your Payroll Recording Service Records Are Backdated, Missing, and Out of Order

You haven't made a payroll entry in over three months. Your payroll records start at January, but about half the numbers don't correspond with your bank transactions. We hear this from Teaneck business owners every week.

It's more common than you think.

Having payroll entries that are behind schedule, incomplete, and disorganized doesn't mean you're bad at what you do. You just aren't the one doing the accounting while running a construction project out in Glenpointe or taking a customer call. So gross wages and withholdings aren't entered right away. Paystubs sit on the printer or in a file cabinet. The books are in a complete mess.

Let us help you get back on track. The way we go about getting your payroll recording service records in order is pretty straightforward:

1. We obtain all of the payroll statements we need from your payroll vendor for the backdated period.
2. We then reconcile those statements with the bank transactions in QuickBooks online for the same period.
3. We identify missing data, duplicate data, or wrong amounts.
4. Finally, we enter each payroll in QuickBooks correctly, with the right accounts.
5. Your books are now reconciled, and your bookkeeping services and QuickBooks match up.

What we find often in our bookkeeping work is that the big problem isn't the data that didn't get entered into the books. Rather, it's the data that got entered into the wrong accounts. You paid a tax payment that was incorrectly recorded as an expense instead of payroll tax liability, or you entered the net pay but omitted the employer tax liability amount entirely. These small mistakes add up and lead to headaches when tax time comes around.

We have fixed every one of them.

We've cleaned up payroll records that were over a year behind for contractors right here in Teaneck. You have plumbing companies, electrical crews, HVAC services in your neighborhood. You can see how pleased they get when it all adds up correctly in the end. With twenty plus years of accounting knowledge, I know just where to search and how to correct the mistakes. Your records will be accurate and current and your accountant (or the IRS, if that ever happens) will be happy. Don’t know how far off course your business is? Give us a call. We’ll get your business back on track.

Teaneck Businesses that Have Workers in NY with Multi-State Payroll Records

Many of Teaneck workers live in NY and cross the river to work here. Or they live in Teaneck and work in Manhattan, sometimes in both places. They may work for you in Teaneck and spend half the week doing the same kind of work in Rockland. That is multi-state payroll, and a mess to deal with if you haven’t set yourself up properly in the beginning. I run into this issue several times a week.

The reason why multi-state payroll recording service can be difficult is that each state has their own withholding rules. New Jersey and New York have some reciprocal tax rules for certain work locations, but not every state and employee will qualify. And the IRS wants your work and employee records to tell where you or the employee is living and where the work was performed and what state the tax is being withheld to. Otherwise, you can get hit with tax penalties for both states.

What I Record for Multi-State Employees

• State of residency and work for every pay period
• The right withholding rate for each pay period based on NJ and NY tax rates and tables
• The wages paid for the state when a worker is paid while working in different states
• Quarterly checks for everything

The business owner may not even realize that this is an issue until there is a notice. By that point, the back taxes and interest have built up. That is why I stress that good payroll recording is so important. This type of scenario happens often to small businesses near West Englewood who hire people to work across state lines on a regular basis. A roofer who begins a job in Teaneck and ends the job on Thursday in Yonkers needs to have your books set up so that the two different areas are clearly distinguished. I can make the QuickBooks set up for your business where each payroll entry will automatically record where your employees live and where they worked that week. Also, according to the American Payroll Association, multi-state payroll compliance problems are one of the main reasons for small businesses that have state tax audits. If the problem is something so to avoid by recording your multi-state payroll accurately, why risk it? But you don’t have to learn the state’s payroll tax code. Just hire me and I will record your multi-state payroll accurately so your book-keeping is clean, accurate, and up-to-date for any tax filing deadline you need it for. Contact me to get your multi-state payroll recording needs sorted out.

Frequently Asked Questions

Common questions about payroll recording service services in Teaneck

Ready to Get Started?

Book A Free Consultation. Call 973-453-5052 today.