December 2023: The Small Business Owner’s HR, Benefits, Payroll, and Tax Compliance Deadlines
The last month of the year is notoriously busy. Holiday events, sales pushes, budget adjustments, Q1 planning—the to-do list is endless! Luckily, we’ve got your compliance items covered. Here are the tax, payroll, and HR deadlines you need to pencil in this month.
Federal holidays
December 25, 2023
Christmas Day
Depending on your business operations, your employees may or may not be taking the day off—so plan accordingly.
December 31, 2023
New Year’s Eve
Cheers to another year come and gone! Make sure you plan ahead for how your business will operate on New Year’s Eve.
Tax and payroll compliance deadlines
Payroll tax deposits (for semi-weekly depositors)
The Internal Revenue Service (IRS) requires employers who file Forms 940 and 941 to deposit payroll taxes at different frequencies throughout the year.
If you report more than $50,000 in payroll taxes during the lookback period of July 1, 2021 to June 30, 2022, you’re considered a semi-weekly depositor and must follow the schedule below:
| If payday for your employees is on… | Deposit employment taxes by… |
| Wednesday | The following Wednesday |
| Thursday | The following Wednesday |
| Friday | The following Wednesday |
| Saturday | The following Friday |
| Sunday | The following Friday |
| Monday | The following Friday |
| Tuesday | The following Friday |
However, if you accumulate $100,000 or more of tax liability in a single day, the IRS says you must deposit the amount by the following business day, regardless of whether you normally deposit on a semi-weekly or monthly basis (more on monthly deposits below).
To learn more about federal payroll tax deposits, read Publication 15.
Keep in mind that some state and local governments that collect payroll taxes will also expect their own deposits and those deadlines may be different from the federal ones. For more information, contact your state and local tax agencies directly.
December 1, 2023
Plan for end-of-the-year tax prep
The end of the calendar year is the last time to make adjustments to your taxable income for 2023. If you haven’t started preparing for tax season in 2024, meet up with your accountant or tax professional to make a plan. You may need to purchase business equipment or supplies, organize your business expenses and deductions, or gather your documentation for charitable donations.
December 11, 2023
Employee tip reporting deadline for November
Your employees are required to report to you any tips of $20 or more that they earned during the month of November 2023. You can learn more about tip withholding and reporting requirements here.
December 15, 2023
Payroll tax deposits for monthly depositors
If your company follows the monthly payroll tax deposit schedule (meaning that you reported less than $50,000 in payroll taxes during the lookback period), then your tax deposit for November payrolls is due on December 15.
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TaxesForm 8813 quarterly payment voucher due for partnerships
If you’re a partnership, you need to file Form 8813 (your quarterly payment voucher) by December 15 and pay any tax due. You can file the form at this address:
Internal Revenue Service Center
P.O. Box 409101
Ogden, UT 84409
For more information on Form 8813, see the IRS instructions here.
Estimated tax payment due for Q4 for tax-exempt organizations
If you own a tax-exempt organization (like a nonprofit) and expect your tax for the year to be more than $500, you need to pay any estimated tax for Q4 on unrelated business income by December 15. You can use Form 990-W to calculate the amount of estimated tax required.
Estimated tax payment for Q4 due for corporations
If you own a corporation that operates on a calendar year, your fourth estimated tax payment of the year is due December 15.
You can pay online, over the phone, or via mail. For more information on estimated taxes, review Publication 505 or check out worksheet 1120-W.
December 31, 2023
End of Q4
Today is the last day of Q4 for businesses that run on a calendar year.
HR compliance deadlines
December 1, 2023
Deadline for sending annual notices to plan participants
If you offer retirement benefits to your employees, you’re required by law to distribute certain notices to plan participants every year—no later than December 1. These notices can include:
- 401(k) safe harbor annual notice
- Automatic contribution arrangement (ACA) safe harbor notice
- Automatic enrollment notice
- Participant fee disclosure
- Qualified default investment alternative (QDIA) notice
If you have to send out multiple notices to participants, you can combine them into one detailed notice.
Review employee handbooks and policies
December is a great time to review your employee handbooks and policies for efficacy, equity, and consistency. Use this month to make any important changes before 2024.
December 15, 2023
Extended deadline for distributing Summary Annual Report to plan participants
A Summary Annual Report (SAR) explains your company’s retirement plan and other plan details reported in your Form 5500. If you received an extension for distributing SARs to your employees, whether by filing Form 5558 or Form 7704, your new deadline for sending SARs to plan participants is December 15.
December 29, 2023
Last day to conduct nondiscrimination testing for benefit plans
If you offer 401(k) plans, 125 Premium Only Plans (POPs), and flexible spending accounts (FSAs), you’re required to conduct nondiscrimination testing by December 29. This helps ensure that you’re able to offer benefits on the same terms to all eligible employees at your business.
December 31, 2023
Deadline for correcting a failed ADP/ACP test and adopting discretionary amendments
If you need to correct your retirement plan as a result of any Actual Deferral Percentage (ADP) or Actual Contribution Percentage (ACP) testing failures, December 31 is the last day to do so if you want to keep your qualified status. These changes include:
- Correcting a failed ADP/ACP test
- Processing corrective distributions for failed ADP/ACP testing (note that a 10% excise tax may apply)
- Amending plan documents for any discretionary changes implemented during the 2023 plan year
Keep in mind that December 31 falls on a Sunday this year, so you should aim to make all corrections by Friday, December 29 to meet your deadline.
Deadline to change safe harbor status for retirement plans
Any safe harbor status changes that you want to make to your retirement plans must be made by December 31. This includes:
- Changing a traditional 401(k) plan to a safe harbor plan for the prior calendar year (if your company agrees to at least a 4% nonelective contribution)
- Removing a plan’s safe harbor status for the 2024 plan year
Because December 31 falls on a Sunday this year, it’s a good idea to make these changes by December 29.
Deadline for Required Minimum Distributions due under Internal Revenue Code Section (IRC) 401(a)(9)
Plan participants who are 73 or older at the end of 2023 must receive their Required Minimum Distributions (RMDs)—the minimum amount an eligible account holder must withdraw each year—by December 31.
Make sure you plan accordingly since December 31 is on a Sunday this year.
