Confidently Closing Out Your Payroll Year with Arcoro Payroll

As your payroll partner, Arcoro makes the year end as smooth as possible. While this is the busiest compliance period of the year, you don’t have to be a tax expert—that’s what we’re here for.

This guide explains:

• What Arcoro will do for you automatically
• What we need from you to keep your filings clean and accurate
• Key timelines and expectations from December through February

What Arcoro Will Do For You

We Handle Supported Year End Tax Filings 

Arcoro will prepare and file, on your behalf:

• Federal W-2 filings
• State and local W-2 filings
• 1099-NEC filings for contractors
• Annual unemployment and other required payroll returns

As a reference, we have provided a list of supported tax filings

Many agencies allow filings through late February, so it’s normal and fully compliant for documents to finalize during that time.

We Generate, Print & Mail W-2s And 1099s

Arcoro takes care of:

• Printing and mailing W-2s and 1099-NECs for:
  • Workers without electronic consent
  • All terminated employees and contractors
• Ensuring forms are postmarked by January 31
• Providing electronic versions in the worker portal

We Provide Electronic Tax Documents

Workers may download electronic versions of W2 and 1099 forms as well as receive a mailed copy.

We Generate W-2Cs When Required

Arcoro creates corrected W-2s (W-2Cs) after: 

• Wage or tax corrections are made to an employee’s W-2
• SSN updates

Draft amended forms typically appear the Monday following the change. 

We Publish Your Company’s Tax Documents

Employer filing documents appear in two waves: 

• Second Monday of January
• Second Monday of February

Final filed versions replace drafts after agency acceptance. 

We Support You Through The Entire Year End Season

During Year End, we:

• Prioritize original filings in January
• Resume amendment processing in February
• Respond to compliance-impacting issues

What We Need You To Do For A Successful Year End

Your Arcoro Year End Checklist

Complete these steps as early as possible before the end of the year. 

Verify Company Information

Please confirm the following information is accurate in the payroll system:

• FEIN
• State withholding & unemployment IDs
• Local tax IDs
• Your company is in good standing

Replace any “Applied For” IDs with final IDs as soon as they arrive.

Verify Employee Information

Validate the demographic records for all current and terminated employees who were processed in a payroll in 2025.  This will help ensure accurate and compliant tax filing.

Review for all employees:

• SSN accuracy (critical)
• Legal name
• Resident and workplace addresses

Verify Contractor Information (1099)

Check:

• SSN or EIN
• Individual vs business classification
• Current address
• Report any contractor payments outside of Arcoro

Make Sure All Payrolls Are Present

Ensure:

• All payrolls (regular & off-cycle) are present
• No manual checks or cash payments were left out
• Mid-year adopters add prior/terminated employees & wages as historical pay

Arcoro can only file for wages entered into the system.

Submit Corrections Early

Submit as soon as possible:

• Incorrect wages
• Wrong taxation
• Benefits or deduction corrections
• Moving wages between states/locals
• Voids or adjustments

Submitting by early December gives the best chance for original filings to remain accurate.

You can submit a support ticket to us to assist with any corrections needed.

Report Third-Party Sick Pay

If an insurance provider paid disability benefits, send Arcoro:

• Total taxable benefits
• Taxes withheld
• Carrier notice

Report Group Term Life (GTL) Over $50,000

If not tracked per payroll, submit the imputed income amount for accurate reporting.

Review Benefits Setup

Confirm deductions, contribution amounts, and effective dates for the new year:

• Benefit Deductions for Payroll
• Post-Tax Deductions for Payroll

Review Updates and Reminders for the Start of 2026

1. State Unemployment Insurance (SUI) Rates – Many agencies will be sending out new unemployment rates for companies operating in those states. The rates may not change depending on the state you operate in. If these do change, the signatory for tax documents will need to update this in the payroll system. 
2. Federal Withholding Window – The best time to allow employees to update W-4 information for Federal Withholding is the start of the new year.  
3. 2026 Tax Updates - The calendar year brings many changes to payroll taxes; taxes restart, amounts change, and new taxes may apply.  Below is a reference to these changes to be aware of. These may not apply to your organization, but feel free to reach out if you believe they do. 
   • Wage Base Considerations
     • Social Security will restart and be withheld on a higher amount in 2026. The maximum amount of earnings subject to Social Security tax (i.e., the taxable wage base) for 2026 will be $184,500 (up from $176,100 for 2025). 
     • Federal Unemployment and State unemployment taxes will restart. Federal unemployment has a $7,000 wage base. Most employers meet this value early in the calendar year. Seeing these amounts restart can lead to a larger cash requirement with that first pay run. 

   • Benefit Changes in 2026 - Arcoro will automatically update the annual limits in the system. However, employees should be reminded to adjust their per-pay-period rates if they want to reach the new maximum amounts (for example, 401 (k) deductions may need to increase to hit the new annual limit). Below is a summary of benefit amounts and their new limits.

     Benefit	2026 Limit	2025 Limit
     Maximum 401(k) Contribution	$24,500	$23,500
     Catch-up 401(k) Limit, Ages 50+	$8,000*	$7,500
     IRA | Simple IRA Limit	$7,500 | $17,000	$7,000 | $16,500
     FSA for Health Care Expenses	$3,400	$3,300
     HSA: Individual | Family | Catch-up	$4,400 | $8,750 | $1,000	$4,300 | $8,550 | $1,000
     Parking | Transit FSAs	$340 | $340	$325 | $325

     *Under the SECURE Act 2.0, catch-up contributions must be Roth for those earning over $150,000.

   • Minnesota Paid Leave - Minnesota has implemented a new Paid Leave program, which is going into effect on January 1st, 2026. This program is funded by a 0.88% payroll tax, which is funded by a combination of employee and employer contributions. And like other states’ PFML programs, employers below a certain size by employee count will be subject to a lower tax rate.
     • Employers will also have an option to provide paid leave benefits through a private plan in lieu of the public program.
     • In December, Minnesota employers will be prompted for setup parameters related to this tax, and will see their Onboard Status change to needs_attention.
   • California State Disability Insurance Increase - The State Disability Insurance (SDI) program, which includes Paid Family Leave (PFL). The contribution rate will increase to 1.3% from 1.2%,
   • Colorado FAMLI Premium Rate Decrease - The state’s paid leave program premium drops from 0.9% to 0.88% (paid by both employers and employees), slightly improving employee net pay and reducing employer payroll expense

Key Dates & What To Expect

If Something Does Not Look Right

If a W-2 or 1099 doesn’t match expectations:

1. Compare to payroll records (note: W-2 uses taxable wages, not gross pay)
2. Contact Arcoro Support if something appears incorrect

Encourage Electronic Delivery

Electronic forms are:

• Faster
• More secure
• Not dependent on mailing addresses
• Available anytime

FAQs

Below are common employer & worker questions at Year's End.

Q. Why do W-2s and 1099s have to be mailed?

A. Federal law requires annual tax forms to be mailed unless the worker consents to electronic-only delivery. 
Additionally, all terminated workers must receive paper forms to ensure access.

Q. What is the fee for printing and mailing forms?

A. Additional fees will apply per printed and mailed W-2 or 1099 form. Consult your account manager for more information about fees & pricing.
This applies beginning with the Year End 2024 filings mailed in January 2025. 
There is no additional fee for amended forms.

Q. If a worker receives both a W-2 and a 1099, do we pay twice?

A. Yes. Each form is billed separately.

Q. What are the requirements for former employees/contractors?

A. Terminated workers may not be able to access online portals. 
To remain compliant, Arcoro will mail all terminated workers’ W-2s and 1099s.

Q. Can workers download an electronic copy even if they receive a paper copy?

A. Yes. Electronic versions will be available beginning January 20, 2025 for download through the Documents area.

Learn more about W2 and 1099 Generation and Delivery Options Here.