Human Resources & Payroll, George Mason University

Tax Time—Online

Until a few years ago, every January, staff in the Human Resources and Payroll department at George Mason University (Va.) began the arduous task of printing and mailing more than 10,000 W-2 statements for faculty, staff, and student workers. To meet the federal requirement that all W-2s be issued no later than January 31st, four people normally worked an entire weekend—from Friday afternoon through Sunday afternoon—printing, sorting, and readying the W-2s to be mailed, says Sue Tinsman, director of payroll and human resource information systems (HRIS). The combined labor, paper, and postage costs of hardcopy W-2s topped $6,400.

In 2005, the decision was made to transition from paper to online distribution of W-2 statements, beginning in the 2006 tax year. The change was initiated to assist the university’s back office departments in becoming more innovative. George Mason’s motto is “Where innovation is tradition.” But, notes Tinsman, while the academic departments have always been on the leading edge, the back office departments had been lagging. The move online with W-2 distribution was a step forward.

George Mason was already using the SunGard Banner system internally, so all that was required was some “tweaking” to the baseline product. Employees also had to consent to receiving their W-2 electronically before they could be issued in the new format.

Once implemented, the new system reduced the costs of distribution across the board. Online delivery also made it possible to disseminate them sooner. This year, the W-2s were posted online for download on the first Friday in January. The few forms that still had to be mailed, for employees who prefer hardcopy and for international students who require them, took three people three hours. “They started work at 11 a.m. and by 1 p.m., everything was printed, sorted, and ready for mail pick-up,” reports Tinsman. What used to cost $1,600 in labor now costs $180, with an additional $4,800 in savings on postage and printing expenses.

Other benefits of electronic distribution include being able to resolve discrepancies or errors before the information is transmitted to the IRS, at the end of the month. Faculty and staff who have questions about their W-2 can receive real-time responses through phone and email hotlines, which are monitored several times a day during tax season, says Tinsman.

For employees, “knowing three weeks in advance if you owe or have a refund due to you is a big deal,” says Tinsman. Being able to provide W-2s earlier gives employees that extra time to prepare if they discover they owe the IRS.

Although George Mason has not yet reached 100 percent electronic distribution, the percentage of employees opting for online access has been climbing consistently each year. For tax year 2008, 56.5 percent of all W-2s issued were sent electronically. In tax year 2011, that figure had risen to 70 percent, on top of a more than 10 percent increase in the number of W-2s being produced. Between 2008 and 2011, the number of W-2s processed went from 11,221 to 12,656. And as W-2 counts climb, so too do the annual savings, points out Tinsman.