How to Enter Payroll History Accurately
Payroll history is the record of payments an employee already received before you started running payroll in Patriot. Entering it correctly keeps Year-To-Date (YTD) totals accurate, since YTD totals affect W-2 forms, annual Form 940 (Federal Unemployment Tax), annual Form 941 reconciliation, and payroll tax deposits made throughout the year. Understated payroll history leads to understated YTD totals, which can cause errors on year-end tax forms and may trigger notices from the IRS or state agencies.
Step-by-Step Guide for Entering Payroll History
Start with the first pay date that payments were actually made.
Do not enter $0 payrolls or lump-sum entries for any period with no payments.
Future pay dates are not accepted in payroll history.
Enter data sequentially, one employee at a time, starting with each employee's oldest pay date and moving to the newest, so the data stays in chronological order and matches actual payment records.
Enter each payroll using the correct pay period and pay date:
For an open quarter, enter each payroll individually, using its actual pay period and pay date.
For a closed quarter, you can either enter payrolls individually or combine them into one lump-sum entry. For a lump-sum entry, use the quarter's start and end dates as the pay period, and set the pay date to the last date of the quarter.
Exception: If you're a semi-weekly federal tax depositor, enter payroll history by individual pay date for the entire year, including closed quarters. Lump-sum entries aren't an option.
How Do I Know If I'm a Monthly or Semiweekly Depositor?
Check your lookback period, which is the 12-month period the IRS uses to determine your federal tax deposit schedule. If your total tax liability during the lookback period is $50,000 or less, you're a monthly depositor. If it's over $50,000, you're a semiweekly depositor. New employers start as monthly depositors.
Troubleshooting YTD Payroll History Discrepancies
If YTD totals appear too high or incorrect after entering payroll history:
Review entered data. Verify that only actual paid periods were entered, and confirm no $0 payrolls or lump-sum entries were mistakenly added for periods with no payments.
Check payroll reports. Use payroll reports to review the details of entered history and identify discrepancies or errors.
Correct errors. Void any incorrect entries and re-enter them correctly so YTD totals align with actual payments made.