Sovos Withholding Compliance offers consolidated solution for Tax Payments

By Edlyn Cardoza

Sovos recently announced new automation functionality within its Sovos Withholding Compliance solution for managing payroll and non-payroll withholding tax payments and related IRS and state returns in a single place. Following its December 2020 acquisition of LTtax, Sovos has further expanded its withholding compliance solutions to automate the processing of payroll and non-payroll tax liabilities in a centralised location, linking critical reconciliation capabilities to Forms 1099 and W-2 for compliant Form 940, 941, 944, 945, and 1042 return filing in a single solution.

For decades, organisations have managed payroll and non-payroll tax withholding processes manually and in disparate systems, which puts them at risk for incurring penalties with federal, state, and local governments due to human errors made while processing payments, filing returns or reporting unreconciled tax information. Sovos is eliminating manual processes by automating payment processing, filing returns and reconciliation capabilities and consolidating all withholding processes into one centralised solution, providing greater visibility across tax withholding teams.

“Sovos Withholding Compliance automates the critical manual processes of determining when, where and how much needs to be paid and reported – along with automated delivery of the payments and return information wherever possible,” said John Kreger, vice president, product management, Sovos. “We expect customers to receive 70% of their time back that had previously been devoted to internal, manual withholding tax responsibilities. This will aid in preventing burnout and turnover of valuable accounting and tax professionals – an especially critical move in the midst of the Great Resignation.”

Sovos Withholding Compliance also has the following features:

• Introduces automated delivery capabilities for IRS and state ACH payments
• Offers check processing capabilities for fulfilling payments to jurisdictions where automated payments are not accepted
• Automatically generates electronic delivery for Forms 940, 941,945 and participating state equivalent forms
• Automatically generates paper delivery for Forms 1042 and amended Forms 94X
• Supports withholding and State Unemployment Insurance (SUI) wage detail reports through electronic processes
• Ensures that automation of payments and filing includes detailed audit trails, saved confirmations and the ability to track federal, state, or local penalty correspondences