Business.com

Business.com

How to Encourage Employees to Take Business Security Seriously

Posted: 12 Dec 2019 10:00 AM PST

Data breaches are on the rise for companies both large and small, and sadly there's no surefire way to prevent one from happening. Fortunately, there are steps you can take to protect your business and make it that much harder for malicious actors to penetrate your defenses.

According to a study from Kaspersky Lab and B2B International, 52% of businesses identify employee-error as the biggest threat to company security. But, with the right education and tools in place, this doesn't have to be the case. Your workers can become your first and strongest line of defense against breaches. Here's how you can make that happen.

1. Use layered security

If you want your employees to take security seriously, you need to demonstrate that it's a priority for your company. This means investing in layered security – the practice of using multiple security controls at different levels to protect your data. 

Don't put all your trust in SSO, multi-factor authentication, or password managers. A single tool simply isn't enough. Instead, layer these tools on top of one another – use a password manager with multi-factor authentication, and if it's feasible, implement SSO wherever possible. The more safeguards you have in place, the stronger your security.

By layering protective measures, you'll have backups if one or more of your defenses fail. You'll also show employees how paramount security is to the company's daily operations, instilling in them the need to take it as seriously as you do. 

2. Encourage good password habits

A recent report by the Ponemon Institute and Yubico found that 51% of respondents have experienced a phishing attack. Yet, 57% of those people still haven't changed their password behaviors. And, considering that the same survey reports that almost 70% of respondents share passwords without taking proper security precautions, and over half reuse passwords, that's a huge vulnerability for any company.

It's important to encourage your employees to practice good password behavior at both home and work. If a member of your team is using a weak password like "Fluffycat123" for their personal accounts, chances are they'll use them for their professional accounts too. Reusing passwords for multiple sites is a huge security risk because if that password is breached, all of the accounts using that weak password will be compromised. 

Everyone should set strong passwords that are long, complex and unique for every online account they use. But, it's impossible to remember multiple complicated passwords, so use a secure program or password manager to store them. 

By encouraging good password habits among employees and providing them with the tools that make it easy for them to put these habits into practice, you will significantly strengthen your company's security.

3. Educate your employees regularly

Phishing scams are becoming more and more sophisticated, so it's important to educate employees on how to identify these messages. It's crucial to periodically test whether employees can flag suspicious communications and know what to do when they receive them.

By holding regular training, and putting these messages in employee inboxes, you're keeping phishing at the top of their minds. After all, if they're on the lookout for these kinds of scams, they are much less likely to fall victim to them.

Remember, if employees fail these phishing tests, it's important not to shame them. All it takes is a momentary lapse in concentration to click the wrong link, and some people simply find identifying these messages more difficult than others. Instead, provide additional training and only give people access to the data and logins they need.

Keep track of how your teams perform and celebrate progress with them. When employees see results improving, they're more likely to see the value in the training you're providing and get on board with what you're trying to achieve. 

4. Make security easy to use

One of the biggest mistakes that companies make when designing security is creating processes that are cumbersome for employees. 

Forcing monthly password resets with long, complicated passwords without providing access to a password manager will only encourage workers to store their passwords in non-secure ways. Or, refusing to provide access to a site that doesn't support SSO can push employees into creating non-secure accounts that you don't have visibility of. These workarounds create huge security holes, and it's important not to put the onus of security on employees. 

When security is convenient, your employees are more likely to embrace it. Ultimately, people tend to take the path of least resistance, so choose tools that become part of their everyday workflow and actually make their job easier.

IT departments should make security as easy and seamless as possible, rather than expecting employees to go out of their way to work with frustrating security requirements. Some compromise is often required, but always keep in mind what you're asking of employees.

5. Keep lines of communication open

When people don't feel confident in an area outside of their usual role, there's a risk that they'll shy away from it and avoid it altogether. Security can seem like a daunting subject to some, filled with technical language and complicated systems. You need to make security accessible, and that starts with good communication.

Write your security policies in clear language that's easy to understand and make sure everyone knows where to find them. Your employees are your most important security measure; when they're informed and feel engaged it fortifies all other layers of your security.

When someone has a security question, they need to know who to approach and feel comfortable in doing so. They mustn't be made to feel stupid for asking or villainized if they make a mistake. Issues are much easier to resolve when they're out in the open, rather than hidden out of fear or shame.

Respect your employees as the solution, not the problem. Invite them to share their thoughts and feedback, and act on their suggestions when appropriate. When they see that their contributions matter, they'll feel empowered and motivated to play their part in securing your business.

6. Make your employees feel valued

Part of building up your security is ensuring your employees are invested in the company they work for; that way, they take security as seriously as you do. 

There's no superficial way to do this – people can tell when these kinds of actions aren't genuine, and you need to start from the ground up. It's about truly embedding positive attitudes into your company culture.

Be fair with your employees and transparent in your communications. Trust the people you've hired to do their jobs – respect, support, and empower them. Reward successes and don't finger-point when people stumble.

Being generous and showing your employees they are valued will mean they actually care about the welfare of the company they work for and become invested in protecting it and maintaining security.

While there's no way to fully prevent security breaches, taking these steps will go a long way toward increasing your security. Whether large or small, your company should absolutely have a plan in place for dealing with these breaches if they occur, but by taking these steps and investing in your employees, hopefully, you will never have to use it.

5 E-Commerce Trends You Should Expect in 2020

Posted: 12 Dec 2019 09:00 AM PST

  • Entrepreneurs can start an e-commerce website for less than $500, resulting in more online storefronts than ever before. 
  • Marketers are discovering new ways to repurpose their written content and finding exciting ways to curate new content. 
  • 67% of the population owns a mobile device, which makes social commerce and progressive web apps necessary in 2020. 
  • Voice search is growing in popularity, forcing business owners to think about on-site SEO. 

Are you a small business owner who wants to prepare your e-commerce website for 2020? If so, you're not alone. The e-commerce market is growing rapidly and shows no sign of letting up. In 2020, it's estimated that online storefronts will sell $4.17 trillion worth of products and services. 

We know that this number sounds staggering, and you're wondering how you can ever keep up in the oversaturated world of online retail. It turns out that there are plenty of things you can do to improve your chances of success. 

Today we are going to look at five e-commerce trends you should expect in 2020 and explain how you can use these trends to grow your small business. 

1. Smart content repurposing 

Content marketing is the lifeblood of a good e-commerce website. Consumers want to interact with your business beyond browsing your catalog and completing the checkout process. In fact, most people are hesitant to buy a product from a company that doesn't have a blog. 

Your content should entertain or educate your audience. If you have an exceptionally talented writer, you can do both of these things in one piece of content. Due to the numerous platforms available to share content, marketers are making a push towards repurposing old content. 

Revisit your blog posts, and your analytics data will tell you which posts were popular and which ones left users feeling bored. Take your most exciting pieces of content and turn them into infographics, videos or podcast discussions. Video content, in particular, has proven useful in virtually every industry. Repurposing your content by turning it into a video and sharing it on social media can yield massive results. Social media videos get 1,200% more shares than their text counterparts. Adding attractive image thumbnails to your content can result in additional likes and shares across all social platforms. 

2. Dynamic pricing

Dynamic pricing is going to play a significant role in improving your marketing ROI, as well as your conversion rate. In essence, dynamic pricing is a practice where a business will examine information about its target audience, competitor pricing, and market demand to adjust prices in real-time.  

Let's say your competitors decided to increase their price by $50, while demand is slowly rising. A smart business owner will use this opportunity to slightly raise the price to meet the demand while undercutting their competitor's prices. This tactic ends up helping both business owners and consumers. 

As a result of businesses trying to compete with each other while making a profit, there's a drive to create products that are both effective and cheap. The result is your product is more affordable, and consumers are more likely to buy something from your e-commerce website if the price is right. 

3. Progressive web apps  

Progressive web apps (PWAs) are increasingly common in the online retail space. Essentially, a PWA is a website with a mobile-responsive design that's so effective that it resembles an online app that you would normally download from the Google Play Store. 

Developers and business owners work together to create a PWA that can satisfy customer needs, regardless of the device they are using. At the same time, the consumer is treated to a visually appealing, responsive website. 

There's no mystery as to why more e-commerce retailers are taking this approach. Currently, 66.53% of the global population owns a mobile device. Most people use their smartphones for browsing and online shopping. If a site looks ugly on a mobile device, the user will leave. You've now lost a customer. However, if they come to your website, and they are treated to a professional-looking PWA, they will stick around and browse your product selection. 

4. Voice search SEO 

Voice search is another trend that's on the rise. Marketers are heavily focused on voice search because many consumers use speech recognition software with their mobile devices and smart home speakers to find products and services through Google. Statistics show that people are using voice search to make online purchases. A staggering 62% of individuals who own smart speakers claim to have bought a product with their device. 

There are several ways you can improve the voice search SEO of your website. Traditional SEO is based on what someone might type into Google but optimizing for voice requires you to consider what customers might ask when talking to their Google Assistant or Apple's Siri. 

For example, if someone wants to find an affordable summer outfit, they might type "affordable summer outfit" into Google. However, someone with a smart speaker might ask, "Where can I find affordable clothes for summer?" The difference sounds subtle, but the search results associated with each phrase vary drastically. 

When you're researching keywords for voice search, think about your sales funnel and what questions a consumer could have, based on their position in the buying cycle. In our previous example, you would find someone in the "discovery" phase. If you want to target consumers that are ready to buy something, you might consider using a long-tail keyword like "How much is a summer floral dress?" This variation resembles something that a consumer might say if they are using a smart speaker.  

5. Buying options on social media 

E-commerce business owners use social media as a way to share their content and engage with their audience. These platforms also give you the option to upload your catalog to your social media profile, and consumers can buy something from your storefront directly from the application. 

This feature has plenty of exciting implications for retailers and can cut multiple steps out of the buying process. Businesses can now create specials that apply to users that make a purchase with their social media profile, which can lead to additional sales. If the consumer has a good experience, they are more likely to visit your official website and buy other products in the future. 

Marketing ads to new consumers that promote this buying option can also lead to more followers and user engagement. If you decide to use this technique, make sure you have a dedicated social media team to handle customer inquiries and assist users that have questions before they complete their purchases. 

Conclusion

There are more e-commerce retailers than ever before. If you want to succeed in this space, you have to pay attention to the new emerging trends. This already competitive market is expected to grow across all industries in the coming years. 

Consumers expect a wide variety of content across various mediums and the ability to find brands that interest them with their smart speakers. Make sure you're making the most of your social media profiles and engage with your customers and show personalized ads with dynamic pricing if you want to increase your revenue and grow your e-commerce business in 2020. 

7 Simple Tips for Protecting Your Brand Against Cyberattacks

Posted: 12 Dec 2019 08:00 AM PST

There is plenty of great advice you can find online about protecting your business from cyberattacks. However, protecting your brand requires a more intricate strategy. It doesn't refer strictly to protecting your data and customers – it also refers to protecting your image and reputation.

There are plenty of ways for hackers to destroy your brand even though they never directly attacked your website. They can spread misinformation, conduct phishing attacks by posing as your business, or misuse your product or services. All of these things can be treated as cyberattacks on your brand, so let's talk about how to deal with them.

Start with a basic security plan

The best way to deal with cyberattacks is to prevent them. Prevention can come in two forms: passive defense and active defense. A basic security plan is a passive defense; here's how to make sure it's strong.

1. Use HTTPS protocol

Using HTTPS protocol is a norm for any website that stores users' personal information such as their email addresses, street addresses and credit card numbers. This protocol prevents third parties from accessing or modifying information exchanged between the website and the user.

The HTTPS protocol is enabled by installing an SSL certificate, which is normally purchased alongside the website domain. While there are businesses that still use HTTP protocol, HTTPS is favored by search engines and users, who can check the validity of the website's SSL certificate by looking at the padlock icon in the address bar. 

Long story short – if you want to protect your business and brand, make sure you go HTTPS.

2. Carefully consider how and where you store data

Storing sensitive information and protecting it against cyberattacks is one of the greatest challenges for brands. Every brand wants to keep their workflow smooth and its customers feeling safe. There are four ways data can be stored:

  • On-premises: storing data on physical servers owned by the business
  • Colocation: storing data on physical servers in specialized centers, sharing space with other businesses
  • Public cloud: storing data online in clouds used by multiple businesses
  • Private cloud: storing data in clouds dedicated to a specific business, customized by extra layers of protection

None of these methods is completely immune to cyberattacks. Due to their scalability and affordability, public clouds are increasingly popular among small and mid-size businesses. Although public clouds offer great protection against cyberattacks, if they happen, they endanger multiple businesses and can affect millions of users. 

Depending on the sensitivity of data you store, you can opt for one of these solutions, but keep in mind it is always a good idea to compartmentalize your data and use additional protection. 

3. Update your software

A responsible brand treats every aspect of its workflow with great consideration. This refers even to those small annoying tasks such as updating software that is used on a regular basis. Software updates are a valuable line of defense against cyberattacks as they contain fixes for both core features and vulnerabilities to the latest hacking methods.

Want an example? When the notorious Equifax data breach happened, more than 140 million people had their addresses, credit reports and social security numbers exposed. Equifax had a fix for a vulnerability in its web application available through updates two months before this cyberattack took place!

So, protect your brand and don't click on the "cancel" or "later" button the next time you get a pop-up window on your computer for new updates. 

4. Educate your employees and control their access to your network

Employees' irresponsible behavior, lack of education or misuse of credentials is behind an alarmingly large number of cyberattacks. Thus, protecting your brand also means teaching your employees how to spot cyber threats, how to double-check content they are accessing and how to use the company's resources responsibly. 

On top of that, sometimes you also have to protect your brand from your employees. Limit their access to the features and network compartments that are relevant to their jobs.

5. Have a crisis plan

Around two-thirds of businesses don't have a disaster recovery plan in case of a cyberattack. If you want to build and maintain an image of a reputable brand, it is important that you have an emergency plan. This includes:

  1. Clearly defining potential security breach(es)
  2. Having a designated incident response team
  3. Creating a clear crisis protocol with a detailed chain of action
  4. Regularly updating the plan and testing protocols

With a crisis plan, even if the worst happens, you will be able to quickly address, minimize or eliminate the security threat. More importantly, you will maintain the reputation of a brand that is organized and capable of dealing with difficult situations. 

Proactively prevent cyberattacks

An active defense to prevent cyberattacks requires you to monitor what's happening on your website and outside of it. Some of the most damaging types of attacks include hacking (compromising cybersecurity by exploiting vulnerabilities of a digital device), phishing, malware, and errors and abuse by employees. Here are two ways to actively defend your business:

6. Monitor suspicious website visitors

First, focus on things that happen on your website. One of the most effective ways to see who's lurking and what their intentions are is to use website categorization tools in correlation with other tools such as domain name monitoring solutions. These API tools allow you to analyze your website visitors and find indicators of compromised security. For example, this could be a domain that keeps trying to access your website's control panel. 

Once you are warned, these tools can investigate this domain's credentials, purpose, and malicious activities. Based on the results, you can blacklist such domains from even visiting your website. These API tools can also be used to monitor and manage your employees' communication. You can filter web content they can access or receive, protecting them from cyberattacks.

7. Monitor potential impersonators

Phishing is probably the trickiest form of cyberattack. It doesn't rely on malware, but instead primarily focuses on tricking users into willingly sharing confidential information. Most phishing attacks come in the form of emails containing links to pages that faithfully imitate websites of credible, reputable institutions such as banks, hospitals, insurance companies, etc. 

The tricky part is that the attack doesn't explore your vulnerabilities, but it can effectively destroy your brand because it is using your name and logo to steal from your customers. Trusted brands like Amazon or PayPal are often impersonated in phishing attacks. If these attacks become too common and associated with your brand, you have a problem.

So how do you deal with phishing head-on? By monitoring existing and new domains that contain the name of your brand or seek to imitate it. Similarly, as with domains that seek to compromise your website's security, you can block these websites, warn your customers about potential impersonators and report phishing sites to legal authorities. 

Conclusion

Defending your brand from cyberattacks should not be limited to the battle behind the walls. It is important to watch what is happening around you and identify threats on time. This allows you to be one step ahead of hackers and be in full control of your brand. Active defense requires advanced cyber intelligence tools, so make sure you choose them wisely.

How to Boost the Success of Your Lead Generation Strategy

Posted: 12 Dec 2019 06:00 AM PST

  • A solid lead generation strategy is crucial for growth, but about 53% of companies admit that lead conversion is slow for them.
  • Sales teams can improve their strategies by recognizing that leads gained from inbound marketing and outbound marketing efforts convert differently.
  • If a business considers conversion rates and ROI together, then it can more accurately project its returns and optimize its lead generation techniques.
  • When evaluating lead generation efforts, a key metric to track is the cost per qualified sales opportunity rather than cost per lead.

High-quality leads drive every successful business, so a solid lead generation strategy is crucial to any company's growth. But many companies fail to find a winning formula because they focus on the wrong metrics. When choosing a lead generation strategy, it's important to consider all the factors – including sales cycles and conversion rates – that determine exactly how much money to invest upfront and when to expect a return on that investment.

About 53% of companies admit that lead conversion is a slow process. If you can generate more qualified leads from the start, then it'll be easier to grow your company. Sales teams can improve their strategic efforts by recognizing that leads gained from inbound marketing efforts often convert differently from leads gained via outbound marketing.

For instance, employing email marketing tactics can make your company more familiar with possible leads. Research shows that 90% of customers searching for products online haven't decided how they feel about brands. Email marketing tactics will make it more likely for a lead to select your business over other unfamiliar businesses. Lead conversion may take longer in this case, but the ROI will be strong given the low initial costs.

It may seem daunting to invest in a strategy in which leads may or may not enter the sales process. However, if a business considers conversion rates and ROI together, then it can more accurately project its returns and optimize its lead generation techniques accordingly.

Tracking the right lead generation data

When measuring different lead generation techniques, businesses tend to track the wrong data to gauge performance. For instance, they may focus too heavily on front-end metrics (such as number of meetings) or on back-end data points (such as number of closed deals). While both front- and back-end metrics are important to track and understand, they aren't the true indicators of success for lead generation efforts.

Unfortunately, many marketers still mistake them for signs of success. Even though 80% of marketers claim that their efforts are driven mainly by data, they often fail to use the right data when evaluating performance. Following the wrong data can make it difficult to truly evaluate the effectiveness of a lead gen strategy.

For example, judging lead gen's effectiveness solely by the number of meetings a campaign secures means missing out on a key measurement of those meetings: quality. Look at it this way: Let's say that a company pays 100 people $20 each to show up for a meeting, thus generating 100 leads. While $20 is a great cost per lead, how many of those 100 people actually fit the company's customer profile and demonstrate interest in its service or offering? In other words, how many qualified leads has it attracted, and how has that changed the ROI on the $2,000 it spent?

On the other hand, evaluating lead generation efforts solely by the number of closed deals ignores a key metric within the sales process. Closing one deal out of 100 meetings might seem like a poor result of a lead generation strategy, but what if those meetings actually generated 50 opportunities? If only one in every 50 opportunities ends up closing, then the problem is more likely in the sales process.

Techniques for optimal lead generation

The lead generation process starts with the creation of a lead and ends when that lead converts into an opportunity and enters the sales process.

Therefore, when evaluating lead generation efforts, a key metric to track is the cost per qualified sales opportunity rather than cost per lead.

Does your organization need to revamp its lead generation strategy? Consider including these four elements in your new campaign:

1. Utilize traditional email marketing

Email marketing is one of the oldest forms of online marketing. That said, it remains one of the most common and profitable lead generation tactics – and that's because it works. Emails can generate an average of 122% ROI, or more than four times what other digital channels typically generate, according to digital marketing surveys.

While that return on investment is incredible, it isn't the only benefit to utilizing email marketing tactics for lead generation. Email marketing also allows the use of advanced analytics to accurately track how many recipients click through to the website directly from their inboxes and make purchases. Statistics show that for every dollar spent on email marketing, companies make $38 on average from purchases. Even those who don't purchase will be more likely to visit your website, boosting your traffic with leads who you know are already qualified and interested.

2. Rely on effective phone calls

The cold calling strategy is similar to email marketing in that it can be discounted as more of a traditional approach when compared with digital marketing technologies. While businesses can't rely solely on telemarketing, cold calls are still highly effective.

The key is integrating phone calls with other strategies, as research shows they can have lead generation success rates of up to 90% when integrated with emails, social media and other channels. For example, interacting with your audience on social media can help you glean information about what talking points will appeal to them most. Telemarketing can be a larger investment, so having email communication already established will cut down on call times and make it more profitable for lead generation.

3. Connect with your audience on social media

Emails and phone calls to leads are valuable in part because they are so personal. But these days, connecting with leads on various social media platforms offers just as much opportunity for personal connection, and on a broader scale. It's also highly cost-effective: Companies surveyed report that using social media has helped them reduce marketing costs by as much as 45%.

Utilize the most popular platforms your audience visits, such as Facebook and Instagram, to build a social media presence around the interests and concerns that matter to your customer profiles or buyer personas. Social media is also a great way to implement retargeting strategies to stoke interest in leads who have visited your website or signed up for email blasts, all at a minimal cost.

4. Organize networking events for personal interaction

Integrating lead generation strategies across email, phone calls and social media creates an overall customer experience with a sum that is greater than its parts. However, not all of your lead generation techniques should occur from behind a desk or a screen. In fact, more than 52% of business leaders in a Harvard Business Review survey say events drive most of their marketing ROI.

Organize live events like networking opportunities or product activations to attract highly qualified leads. This allows leads to interact with your business personally and gives them memorable experiences that they'll always associate with your brand. Every event and interaction also fuels the phone calls, emails, and social media conversations that turn your qualified leads into valued clients.

Along with following the wrong metrics, focusing on only one lead generation strategy at the expense of others is another common mistake that businesses tend to make. Leads are everywhere, and to gain their interest, you'll have to meet them in as many places as possible. Combine your email, cold calling, social media and event marketing strategies to generate the highest number of qualified leads and then track how many of them convert into opportunities.

A Guide to Payroll Forms

Posted: 12 Dec 2019 05:45 AM PST

  • Employers are required to submit multiple payroll forms to the IRS.
  • Payroll forms include information about employee wages and withholdings. Mandatory withholdings include federal and state taxes. Voluntary paycheck deductions may include health insurance costs and retirement account contributions.
  • Payroll regulations can be difficult to navigate. Hiring a payroll service or an accountant ensures you file payroll taxes correctly and avoid costly fines.

When a new hire is welcomed to the team, small business owners have to do a lot more than just get them up to speed on what their job entails. One big task is making sure they get paid properly and that all the necessary payroll forms are filled out correctly.

While owning a business can be rewarding on many levels, managing payroll forms can be a pain if you're not familiar with the ones you need. During this process, you will be working with various documents based on your employees and business type. There are many forms to consider, and it's important to get it right. 

The Internal Revenue Service penalizes businesses for filing incorrectly or failing to pay employment taxes. Fines vary by the level of the charge, with federal offenses typically more expensive than state ones, depending on the violation. A few years ago, the IRS fined 6.8 million payroll tax penalties, which amounted to $4.5 billion. It's safe to say the IRS isn't messing around, which is why it's important to understand each form and when it's due. [Read related article: How to Do Payroll]

What payroll tax forms do you need to know about?

Missing a payroll tax deadline or filing the wrong form can have expensive consequences. Below we'll explain the payroll report forms that you need to keep on your radar.

Payroll report forms

A payroll report form is used to inform the government of your employment tax liabilities. On this form, you document the taxes you withheld from employee wages and the taxes you paid. Be sure to submit payroll reports for both federal and state taxes. 

Form 941

Form 941, the Employer's Quarterly Federal Tax Return, reports the number of employees you have, their wages and taxable tips, and the federal income taxes you withheld. Social Security, Medicare taxes and sick pay are also documented here, along with any adjustments made to them. You must file this payroll tax form unless you have already submitted a final return, are a seasonal employer, or employ farm or household workers. A payroll form should be filed quarterly.

Due dates: April 30, July 31, Oct. 31, Jan. 31 

Form 944

Form 944 is sometimes used instead of Form 941 by very small businesses. This is known as the Employer Annual Tax Return, and the only businesses that qualify to use it are those that have $1,000 or less in annual liabilities for Social Security, Medicare and federal income taxes. Additionally, you must have a written notification from the IRS permitting you to use this form instead of Form 941. This payroll tax form is submitted once annually instead of quarterly, so if you're qualified to use it, you should. 

Due date: Jan. 31

Form 940

Form 940 is the Employer's Annual Federal Unemployment Tax Return. This payroll tax form is used to report the federal unemployment tax – or the FUTA tax, in reference to the Federal Unemployment Tax Act. This tax funds unemployment compensation to employees who have recently lost their jobs. Your business must pay FUTA taxes if you paid at least $1,500 in wages in a quarter within the past two years. These taxes are paid quarterly but reported once a year. 

Due date: Jan. 31

W-2

The W-2 is one of the better-known forms and should be given to each employee at the end of each year. It is used to report each employee's annual compensation and all federal, state, and other payroll tax withholdings. This does not need to be filled out for independent contractor workers; you'll fill out Form 1099 for them instead.

Due date: Jan. 31

W-3

The W-3 is basically a condensed version of your W-2 forms. For example, one W-3 can represent 10 W-2s. This form is called the Transmittal of Wage and Tax Statements. It includes total earnings, FICA wages, federal income wages and tax amount withheld. You do not need to give W-3s to your employees. Your W-3 should be sent to federal and state governments along with your W-2 forms. 

Due date: Jan. 31

Form 1095-B

If you provide a health insurance plan for your employees that meets or exceeds what the Affordable Care Act calls "minimum essential coverage," you should file Form 1095-B. On it, you'll note the type of health insurance, whether dependents are covered, and the coverage period for the prior year. Your employees will use this form to prove they have qualifying health insurance that exempts them from paying a penalty when they file their tax returns. If your business has at least 50 full-time employees and is what the ACA calls an "applicable large employer," you would fill out Form 1095-C instead.

Due date: Jan. 31

Form 1094-B

Form 1094-B is the Transmittal of Health Coverage Information Returns, which is similar to the W-3 in that it summarizes Form 1095-B with the number of forms you're submitting. It also gives the IRS your name and phone number so it can contact you if it has questions about the forms. As an employer, you don't have to send Form 1094-B to employees; just submit it to the IRS along with the 1095-B forms. Again, if your business is classified as an "applicable large employer," you would fill out Form 1094-C instead.

Due date: Feb. 28

What's a payroll direct deposit form?

A payroll direct deposit authorization form allows employers to send money to employees' bank accounts. Most employers ask employees to provide a voided check to fill out the form, as it provides the ABA routing number that identifies the employee's bank and account number. After the employee signs the form and gives it back to the employer, their money can be sent directly to their account. Banks typically use the Automated Clearing House to coordinate these payments. This solution is not only greener and more secure than paper checks, but it also cuts out the hassle of cashing a check or waiting for it in the mail. 

What are certified payroll forms?

Businesses with government contracts need to submit a certified payroll form, also known as Form WH-347. When a payroll report is certified, it means employees have been paid according to the Davis-Bacon prevailing wage requirement, and it includes a signed statement of approval that confirms the payroll forms are complete and correct. 

A certified payroll report includes the names of every employee, the nature of the work they did, wages, hours worked and amounts withheld. It's typically due the last day of the payroll period. 

When filing certified payroll forms, keep in mind that every state has its own requirements and may ask for multiple forms and filing. Be careful not to overlook your state's conditions. 

How do you add an employee to payroll?

If you are hiring your first employee and don't yet have your EIN (employer identification number), you'll need to get it from the IRS or by submitting Form SS-4. You may also need to get state and/or local tax IDs.

The next step is to verify that your new employee is eligible to work in the U.S. To do this, you need your employee to fill out an employment eligibility form, otherwise known as Form I-9. You'll also need them to fill out an employee's withholding certificate, better known as a W-4, to make sure you withhold the correct tax amounts from each paycheck.

Once you have the completed forms from your employee, add them to your payroll. If you use a payroll provider, you'll need to contact the company to add your new employee to your plan. Make sure to schedule pay periods and have compensation plans for holidays, vacations, and leave. To stay out of trouble with the IRS, report your payroll taxes on time. [Read related article: 4 Common Payroll Headaches and How to Avoid Them]

What's the difference between a payroll status change form and a payroll deduction form?

Payroll status change forms and deduction forms are different in terms of what they do, but you need both when you hire new employees.  

Payroll status change form

As your business grows, you may have an employee whose status or position changes, which can affect their pay, whether they work full or part time, their position or job title, and the department they work in. It's important to document these changes with a payroll status change form, which can then be placed in the employee's personnel file as part of their employment history. 

Payroll deduction forms

A payroll deduction form does just what its name suggests: It helps you determine and record how much money will be withheld from an employee's payroll check. Some deductions are mandatory, such as taxes, while other deductions are voluntary, like 401(k) plans, insurance plans, and union and uniform dues. Court-ordered payments, such as child support payments, may also be garnished from employee wages. This form gives your payroll provider the information it needs to withhold the proper amounts from your employees' paychecks.

Tips to avoid making payroll mistakes

There's no shame in asking for a little help. If you're insecure about how to set up payroll for your employees, or if you simply want to save yourself the headache of navigating payroll regulations on your own, sign up for a payroll service or hire an accountant. It's better to pay for the service and have it done correctly than to pay fines for your mistakes. Here are three tips to help you avoid common payroll mistakes.

  1. Pay attention to deadlines for tax payments and filing. Depending on your business, you may have payroll tax payments due annually or quarterly.
  1. Be careful not to miscalculate overtime. Some states have their own overtime regulations, and in such cases, the regulation that will give the employee the higher pay prevails. Take a look at your state's labor laws beforehand to ensure you're paying your employees fairly. 
  1. Set aside time for processing payroll. Late paydays lead to unhappy workers, and rushing it can cause costly mistakes. If you overpay or underpay your workers, not only will you have to take time to make the correction, you may even face fines. 
Posted by: at

No comments:

Post a Comment

Subscribe to: Post Comments (Atom)