Steer Clear of Tax Amendments and IRS Inquiries
Voiding a check incorrectly may produce a situation in which an employee is reported with negative wages on a tax return. Most tax agencies do not allow negative wages. If negative wages are reported on your tax forms, it may trigger an inquiry and require amendments to be filed.
Listed below are several things you can do to avoid this costly and time-consuming process.
- Do not void a check alone; be sure it is accompanied by a positive check of equal or greater value than the original, unless you are voiding the check under the same check date in which it was issued.
- Void checks in the same quarter they were issued.
- If you are voiding a check and reissuing it for a larger amount, you may have deposits due because of the additional liability. This could place you in a penalty situation.
- Always contact a payroll service representative if you have questions about voiding a check. Following the above guidelines will save you time and money.