Social Security Number Verification for Year-End Payroll Preparation

Verifying your employee’s Social Security number (SSN) is as equally important during year-end payroll tax preparation as it is when you hire a new employee. This information is crucial to reporting earnings and Forms W-2, which greatly affect an individual’s disability and retirement eligibility. As you continue to prepare and organize all files and documents pertaining to year-end requirements, take a look at this Employer Tax Guide created by the Internal Revenue Service to understand the significance of SSN verification. In addition to the guide, the Social Security Department has some tips to help you efficiently and accurately review employee SSNs.

Soon you will close the chapter to your 2014 payroll book and turn your focus to completing Forms W-2. Before you report these forms, have each employee check his or her name and SSN. If there are any name changes, the employee is responsible for contacting Social Security to report the change. The employer should continue to report W-2s using the old name until the employee can verify the change with a new Social Security card. Also, check for errors such as spellings, incorrect SSNs and use of nick names.

Employers can use the Social Security Number Verification Service (SSNVS) to quickly and electronically match employee names and SSNs. This free service allows you to check 10 names at a time with immediate results, or verify this information by uploading a file of up to 250,000 names and SSNs. Employers who opt to load a file can expect results within the next business day. To use this service, register here and click here to learn more about SSNVS.

So what do you do if a SSN is incorrect? First, compare your employee’s Social Security card with your payroll documents. If there is a match, yet the SSNVS shows the information is inaccurate, direct the employee to contact Social Security to address the issue. Secondly, keep track of all steps taken to ensure a correct match and continue to report Forms W-2 with the name and SSN you currently have on file. Form W-2C can be used to make corrections to original Forms W-2 reported with old SSNs or names.

Wrapping up an entire year of hard work is challenging and stressful. With the right tools, organization techniques and resources, your year-end preparation will be easier, especially with the help of a trusted payroll advisor like BenefitMall. If you have any concerns or questions related to preparing your year-end payroll taxes, please contact your BenefitMall representative and we would be happy to offer our guidance.