It’s Important to Review your Payroll Provider’s Compliance

Published by Heather on

It’s Important to Review your Payroll Provider’s Compliance

Recently, the mid-sized payroll provider IOI Pay was accused of fraud, which led to the company’s assets being frozen. The issue? These assets likely included payroll deposits held for their customers that had not yet been submitted to the IRS or state government agencies. Several customers have reported that their July payroll taxes were not paid, leaving them to pay twice with no guarantee of reimbursement from IOI Pay.

If you use a payroll company that withholds your payroll taxes and submits them to government agencies (or is even just responsible for payroll report filings), please remember that the final responsibility for those taxes and filings remains with you, not the payroll provider. You should ensure that you are monitoring your payroll provider’s compliance with payroll filings and tax submissions.

As we reported last year, the IRS now certifies certain organizations that they will allow to take your status as the “employer” for employment tax purposes. By using a certified professional employer organization, your organization would be relieved of the potential liability for unpaid payroll taxes. You can find a full list of organizations which have been certified by the IRS here.

Please contact us if you have any questions regarding outsourcing your payroll to a PEO. If you already use a PEO, be sure to check that the organization has been certified or plans to become certified.