Year-End Payroll Admin Playbook: What Admins Need To Get Right As 2025 Closes Out
Payroll admins closing out 2025 are juggling more than dates and deductions, from final pay runs to bank holidays and tax deadlines, all while trying to keep everyone paid correctly and on time. The big objectives are clean 2025 data, accurate reporting, and a smoother start to 2026.
Final 2025 payroll runs
The last payrolls of December serve as the official record of what employees earned in 2025, so they require extra scrutiny. Paychecks for work done in December but paid in January are usually reported in the year they are paid, so placement on 2025 versus 2026 forms must be confirmed carefully.
Key actions:
Reconcile year to date wages, taxes, and deductions against accounting records and bank statements before running the final 2025 payroll.
Include all approved bonuses, commissions, fringe benefits, and termination payouts in time for the last 2025 check date so they are properly taxed and reported.
Confirm pay schedules and cutoffs early so last minute adjustments do not push intended 2025 earnings into 2026.
How bank holidays affect payroll
Bank holidays are non processing days for the banking system and the ACH network, which means payroll debits and direct deposits do not move on those dates. When a scheduled pay date falls on a holiday or weekend, direct deposits typically land on the previous business day, which can require earlier submission and funding.
Key considerations:
Ensure direct deposit files are approved and funded with enough lead time so they settle by the business day before a holiday pay date, because missing that window can push deposits to the next business day after the holiday.
Avoid scheduling off cycle runs, such as special bonuses or corrections, on or immediately before bank holidays unless absolutely necessary, since processing windows are tighter.
Pay extra attention to holidays around the end of December and early January, when year end payroll and the first cycle of the new year are close together.
Year end taxes and forms
Year end is when payroll information becomes formal tax reporting, which makes accuracy and timeliness essential. For most employers, January 31, 2026 remains the key deadline for furnishing and filing core employee and contractor forms related to 2025 pay.
Key actions:
Prepare and distribute Form W 2 to employees and Form 1099 NEC to eligible contractors by January 31 and file the required copies with the appropriate agencies.
Make sure all taxable fringe benefits, such as certain noncash perks or personal use of company vehicles, have been imputed and taxed before finalizing W 2 amounts.
Verify that federal, state, and local withholding and unemployment tax filings match payroll records, including any adjustments for states with FUTA credit reductions.
Data hygiene and compliance checks
Year end is an ideal time to tidy up payroll data so that future reporting, audits, and employee questions are easier to manage. Cleaner data also supports better analytics and reduces the risk of discrepancies with tax agencies.
Key actions:
Review employee profiles to confirm correct legal names, Social Security numbers, addresses, and tax elections so they align with what will be reported on forms and returns.
Reconcile and archive quarterly and annual payroll reports and store records securely for at least the minimum federal and state retention periods.
Lock prior year payroll data once filings are complete so later changes cannot break alignment with forms and returns that have already been submitted.
Preparing systems and workflows for 2026
Moving into 2026 involves more than a new calendar because tax rates, wage bases, and benefit limits often change. Adjusting systems and processes now helps reduce under withholding, over withholding, and preventable errors in the new year.
Key actions:
Update payroll settings for 2026 tax parameters, including changes to Social Security wage bases, retirement contribution limits, and any new or revised state or local payroll taxes.
Coordinate with HR and benefits teams so deduction tables match 2026 plan designs and any integrated tools use the same updated values.
Document a standard year end checklist that covers reconciliations, holiday affected cycles, reporting steps, and system updates so future year ends follow a consistent, repeatable process.
Turning lessons from 2025 into a better 2026
Year end offers a built in opportunity to reflect on what worked and what created stress in 2025 payroll operations. Small adjustments now can translate into fewer reversals, fewer timing issues around holidays, and fewer questions from employees in 2026.
Helpful next steps:
Hold a brief review of the year to identify where errors, reversals, or late approvals occurred and update internal cutoffs and workflows to address the root causes.
Clarify roles for finance, HR, and operations so responsibility for accurate and timely payroll is shared and expectations are clear before the new year begins.
About Rollfi
Rollfi empowers banks, vertical SaaS platforms, accounting firms, and fintechs to add payroll and benefits to their offerings through white-label solutions and robust APIs. With Rollfi’s infrastructure, platforms can unlock new revenue, boost customer retention, and gain valuable payroll data insights. Fast deployment and full regulatory coverage make Rollfi the easiest way to turn your platform into a one-stop shop for essential business services.
Payroll admins closing out 2025 are juggling more than dates and deductions, from final pay runs to bank holidays and tax deadlines, all while trying to keep everyone paid correctly and on time. The big objectives are clean 2025 data, accurate reporting, and a smoother start to 2026.
Final 2025 payroll runs
The last payrolls of December serve as the official record of what employees earned in 2025, so they require extra scrutiny. Paychecks for work done in December but paid in January are usually reported in the year they are paid, so placement on 2025 versus 2026 forms must be confirmed carefully.
Key actions:
Reconcile year to date wages, taxes, and deductions against accounting records and bank statements before running the final 2025 payroll.
Include all approved bonuses, commissions, fringe benefits, and termination payouts in time for the last 2025 check date so they are properly taxed and reported.
Confirm pay schedules and cutoffs early so last minute adjustments do not push intended 2025 earnings into 2026.
How bank holidays affect payroll
Bank holidays are non processing days for the banking system and the ACH network, which means payroll debits and direct deposits do not move on those dates. When a scheduled pay date falls on a holiday or weekend, direct deposits typically land on the previous business day, which can require earlier submission and funding.
Key considerations:
Ensure direct deposit files are approved and funded with enough lead time so they settle by the business day before a holiday pay date, because missing that window can push deposits to the next business day after the holiday.
Avoid scheduling off cycle runs, such as special bonuses or corrections, on or immediately before bank holidays unless absolutely necessary, since processing windows are tighter.
Pay extra attention to holidays around the end of December and early January, when year end payroll and the first cycle of the new year are close together.
Year end taxes and forms
Year end is when payroll information becomes formal tax reporting, which makes accuracy and timeliness essential. For most employers, January 31, 2026 remains the key deadline for furnishing and filing core employee and contractor forms related to 2025 pay.
Key actions:
Prepare and distribute Form W 2 to employees and Form 1099 NEC to eligible contractors by January 31 and file the required copies with the appropriate agencies.
Make sure all taxable fringe benefits, such as certain noncash perks or personal use of company vehicles, have been imputed and taxed before finalizing W 2 amounts.
Verify that federal, state, and local withholding and unemployment tax filings match payroll records, including any adjustments for states with FUTA credit reductions.
Data hygiene and compliance checks
Year end is an ideal time to tidy up payroll data so that future reporting, audits, and employee questions are easier to manage. Cleaner data also supports better analytics and reduces the risk of discrepancies with tax agencies.
Key actions:
Review employee profiles to confirm correct legal names, Social Security numbers, addresses, and tax elections so they align with what will be reported on forms and returns.
Reconcile and archive quarterly and annual payroll reports and store records securely for at least the minimum federal and state retention periods.
Lock prior year payroll data once filings are complete so later changes cannot break alignment with forms and returns that have already been submitted.
Preparing systems and workflows for 2026
Moving into 2026 involves more than a new calendar because tax rates, wage bases, and benefit limits often change. Adjusting systems and processes now helps reduce under withholding, over withholding, and preventable errors in the new year.
Key actions:
Update payroll settings for 2026 tax parameters, including changes to Social Security wage bases, retirement contribution limits, and any new or revised state or local payroll taxes.
Coordinate with HR and benefits teams so deduction tables match 2026 plan designs and any integrated tools use the same updated values.
Document a standard year end checklist that covers reconciliations, holiday affected cycles, reporting steps, and system updates so future year ends follow a consistent, repeatable process.
Turning lessons from 2025 into a better 2026
Year end offers a built in opportunity to reflect on what worked and what created stress in 2025 payroll operations. Small adjustments now can translate into fewer reversals, fewer timing issues around holidays, and fewer questions from employees in 2026.
Helpful next steps:
Hold a brief review of the year to identify where errors, reversals, or late approvals occurred and update internal cutoffs and workflows to address the root causes.
Clarify roles for finance, HR, and operations so responsibility for accurate and timely payroll is shared and expectations are clear before the new year begins.
About Rollfi
Rollfi empowers banks, vertical SaaS platforms, accounting firms, and fintechs to add payroll and benefits to their offerings through white-label solutions and robust APIs. With Rollfi’s infrastructure, platforms can unlock new revenue, boost customer retention, and gain valuable payroll data insights. Fast deployment and full regulatory coverage make Rollfi the easiest way to turn your platform into a one-stop shop for essential business services.
Payroll admins closing out 2025 are juggling more than dates and deductions, from final pay runs to bank holidays and tax deadlines, all while trying to keep everyone paid correctly and on time. The big objectives are clean 2025 data, accurate reporting, and a smoother start to 2026.
Final 2025 payroll runs
The last payrolls of December serve as the official record of what employees earned in 2025, so they require extra scrutiny. Paychecks for work done in December but paid in January are usually reported in the year they are paid, so placement on 2025 versus 2026 forms must be confirmed carefully.
Key actions:
Reconcile year to date wages, taxes, and deductions against accounting records and bank statements before running the final 2025 payroll.
Include all approved bonuses, commissions, fringe benefits, and termination payouts in time for the last 2025 check date so they are properly taxed and reported.
Confirm pay schedules and cutoffs early so last minute adjustments do not push intended 2025 earnings into 2026.
How bank holidays affect payroll
Bank holidays are non processing days for the banking system and the ACH network, which means payroll debits and direct deposits do not move on those dates. When a scheduled pay date falls on a holiday or weekend, direct deposits typically land on the previous business day, which can require earlier submission and funding.
Key considerations:
Ensure direct deposit files are approved and funded with enough lead time so they settle by the business day before a holiday pay date, because missing that window can push deposits to the next business day after the holiday.
Avoid scheduling off cycle runs, such as special bonuses or corrections, on or immediately before bank holidays unless absolutely necessary, since processing windows are tighter.
Pay extra attention to holidays around the end of December and early January, when year end payroll and the first cycle of the new year are close together.
Year end taxes and forms
Year end is when payroll information becomes formal tax reporting, which makes accuracy and timeliness essential. For most employers, January 31, 2026 remains the key deadline for furnishing and filing core employee and contractor forms related to 2025 pay.
Key actions:
Prepare and distribute Form W 2 to employees and Form 1099 NEC to eligible contractors by January 31 and file the required copies with the appropriate agencies.
Make sure all taxable fringe benefits, such as certain noncash perks or personal use of company vehicles, have been imputed and taxed before finalizing W 2 amounts.
Verify that federal, state, and local withholding and unemployment tax filings match payroll records, including any adjustments for states with FUTA credit reductions.
Data hygiene and compliance checks
Year end is an ideal time to tidy up payroll data so that future reporting, audits, and employee questions are easier to manage. Cleaner data also supports better analytics and reduces the risk of discrepancies with tax agencies.
Key actions:
Review employee profiles to confirm correct legal names, Social Security numbers, addresses, and tax elections so they align with what will be reported on forms and returns.
Reconcile and archive quarterly and annual payroll reports and store records securely for at least the minimum federal and state retention periods.
Lock prior year payroll data once filings are complete so later changes cannot break alignment with forms and returns that have already been submitted.
Preparing systems and workflows for 2026
Moving into 2026 involves more than a new calendar because tax rates, wage bases, and benefit limits often change. Adjusting systems and processes now helps reduce under withholding, over withholding, and preventable errors in the new year.
Key actions:
Update payroll settings for 2026 tax parameters, including changes to Social Security wage bases, retirement contribution limits, and any new or revised state or local payroll taxes.
Coordinate with HR and benefits teams so deduction tables match 2026 plan designs and any integrated tools use the same updated values.
Document a standard year end checklist that covers reconciliations, holiday affected cycles, reporting steps, and system updates so future year ends follow a consistent, repeatable process.
Turning lessons from 2025 into a better 2026
Year end offers a built in opportunity to reflect on what worked and what created stress in 2025 payroll operations. Small adjustments now can translate into fewer reversals, fewer timing issues around holidays, and fewer questions from employees in 2026.
Helpful next steps:
Hold a brief review of the year to identify where errors, reversals, or late approvals occurred and update internal cutoffs and workflows to address the root causes.
Clarify roles for finance, HR, and operations so responsibility for accurate and timely payroll is shared and expectations are clear before the new year begins.
About Rollfi
Rollfi empowers banks, vertical SaaS platforms, accounting firms, and fintechs to add payroll and benefits to their offerings through white-label solutions and robust APIs. With Rollfi’s infrastructure, platforms can unlock new revenue, boost customer retention, and gain valuable payroll data insights. Fast deployment and full regulatory coverage make Rollfi the easiest way to turn your platform into a one-stop shop for essential business services.