Payroll documents: what a payroll client sends and when

Employee file: Form I-9, Form W-4 and direct deposit at hire

Each new employee needs Form I-9, Form W-4 and a signed direct deposit authorization on file before the first pay run. The client keeps the originals. The firm checks that each one is signed, dated and complete, because gaps surface later in payroll and in audits.

Form I-9 has two deadlines. The employee completes Section 1 no later than the first day of employment. The employer completes Section 2 within three business days after the first day of employment. The USCIS instructions give the example of an employee who starts on a Monday, who needs Section 2 done on or before that Thursday. If the employee works less than three business days, Section 2 is due no later than the first day.

Keep Form I-9 for the later of one year after employment ends or three years after the first day of employment. If Section 2 was completed late, do not back-date it. Record the actual date in the file and tell the client the deadline was missed.

Form W-4 is the employee’s federal withholding certificate, and the IRS suggests a new one each year and whenever personal or financial circumstances change. Publication 15 lists copies of Forms W-4 among the employer’s recordkeeping items. Decision rule: if no W-4 is on file before the first pay run, the client decides whether the check waits, and the file records that decision.

State withholding forms are separate from Form W-4 and vary by state. Get the forms from each state’s revenue agency for every state where the employee lives or works.

Pay-run records: timecards, the earnings register and pay stubs

The DOL lists 14 items an employer must keep for each non-exempt worker. Test the export against the ones that matter most: the workweek start day and time, hours worked each day, total hours each workweek, the basis of pay, the regular hourly rate, overtime earnings, additions and deductions, total wages each pay period, and the payment date with the period it covers.

Compare timecard hours with register hours at every pay run. The earnings register is the client’s report of gross pay, deductions, taxes withheld and net pay by employee. File it with the timecard export by pay date.

Retention runs on two clocks. DOL requires payroll records for at least three years, and time cards and wage rate tables for at least two years. IRS guidance requires employment tax records for at least 4 years after the tax becomes due or is paid, whichever is later. Keep the register for the longer period.

Failure mode: the timekeeping export and the register disagree for one employee. Treat the timecards as the source, correct the register before the run is approved, and keep both exports so the change can be traced.

Form 941 and the deposit schedule

Form 941 reports federal income tax withheld from employees, plus the Social Security and Medicare taxes on wages, including the employer’s share. It is due the last day of the first calendar month after each quarter. For tax year 2026 the statutory dates are April 30, 2026, July 31, 2026, October 31, 2026 (a Saturday, so the return is timely if filed Monday, November 2, 2026) and January 31, 2027 (a Sunday, so February 1, 2027).

January 31, 2027 falls on a weekend, and the IRS rule moves a weekend due date to the next day that is not a Saturday, Sunday or legal holiday. The fourth-quarter 2026 Form 941 is therefore due February 1, 2027. If every deposit for the quarter was timely and in full, the return can be filed by the 10th day of the second month after the quarter ends, which is February 10, 2027.

The deposit schedule depends on taxes reported in the lookback period. A client that reported $50,000 or less is a monthly schedule depositor. A client that reported more than $50,000 is a semiweekly schedule depositor and files Schedule B (Form 941) with the return. If the lookback taxes are close to the $50,000 line, pull the figures from the filed returns before the first deposit of the year. Do not assume last year’s schedule still applies.

The Form 941 instructions also carve out quarters where total taxes after adjustments and nonrefundable credits are less than $2,500 for the current or prior quarter. Check those conditions before the client pays a quarter with the return rather than by deposit.

Collect these for each quarter: the register totals, every federal deposit confirmation and a note of any late deposit.

Form 940, Form W-2 and Form W-3 for the year

Form 940 reports FUTA tax on the first $7,000 paid to each employee in a calendar year. The register should show that the cap was applied.

The 2025 Form 940 was due February 2, 2026, because January 31, 2026 fell on a Saturday. The 2026 return is due February 1, 2027, or February 10, 2027 if all FUTA tax was deposited when due. Deposit rule: if FUTA tax is more than $500 for the calendar year, the client must deposit at least one quarterly payment. A quarter’s liability of $500 or less carries forward until the cumulative amount exceeds $500. Check the cumulative balance every quarter.

Forms W-2 and W-3 for 2026 wages go to the SSA by February 1, 2027. Copies B, C and 2 of each Form W-2 go to employees by the same date. Ask the client for year-end wage and withholding totals in late January, and build the W-2 file from the register rather than last year’s template. Keep a copy of Form W-3 and of each Form W-2 Copy A for at least 4 years.

Expect differences between W-2 wages and quarterly Form 941 wages. Pre-tax deductions and the Social Security wage base explain many of them. Worked example: the 2026 Social Security wage base is $184,500, and the rate is 6.2% for the employee and 6.2% for the employer, according to Publication 15. An employee whose 2026 pay passes $184,500 stops paying Social Security tax at that amount, so list the difference by employee instead of forcing the totals to match.

State filings and the quarterly reconciliation

State filings are the rows the federal calendar does not cover. Most payroll clients owe a state withholding return and a state unemployment wage report, each with its own account number and calendar. This guide does not give state dates, because each state sets its own.

Each quarter, tie four totals: register wages, wages on Form 941, federal deposits made, and the federal liability on Form 941. A difference in any one points to a late deposit, a miscoded pay type or a keying error. Check each pay date against the quarter the return covers before taking totals from the register.

Tie the ledger too. The payroll clearing account should be zero at quarter end unless an accrual was booked on purpose, and each federal tax payment should match a deposit confirmation in the file.

Who supplies each document, and how often

At hire, the client supplies Form I-9, Form W-4, the state withholding forms and the direct deposit authorization. After every pay run, the client supplies the earnings register and timecard export.

After each federal deposit, the client forwards the confirmation. Each quarter, the client supplies the register totals and the deposit list, and the firm reviews the Form 941 draft. Each January, the client supplies year-end wage and withholding totals for Forms W-2 and W-3, and FUTA wage totals for Form 940.

Failure modes and fixes: a late Section 2 is recorded at its real date, not back-dated. A wrong deposit schedule is corrected for the next deposit, and the late-deposit exposure is reviewed before filing. A W-2 total that does not tie is listed by employee, and only the real errors are fixed. A cumulative FUTA balance over $500 with no deposit is paid, dated and reviewed before Form 940 is filed.