Wells Fargo payroll services are completely incompetent. They have no idea how to do clergy payroll services, and they cost us a lot of money as a result.
Clergy are considered employed for federal income taxes, and self employed for Social Security and Medicare. We get a W-2, but we don't have standard withholding. We either set aside money for quarterly taxes or ask for voluntary withholding. We had opted for the latter.
We had about $5,000 voluntarily withheld for 2017. The W-2 was completely wrong and had to be redone for several reasons. Despite our pleas and the advice of our accountant to do otherwise, Wells Fargo insisted on having the IRS unnecessarily refund the full $5,000 to us as they redid our W-2. This meant that we had to immediately withdraw $5,000 from our savings to pay estimated taxes while we filed for an extension (while waiting for the refund, which six months later we still have not received).
It also meant that, in the view of the IRS, we hadn't paid this money to begin with, so we got slapped with penalties. We have lost out on interest on this money for 6 months and counting. Fortunately, we had it. If we had had to borrow it, we would've been paying interest on it for 6 months and counting.
The money, being tied up, has not been available for our use. The matter also cost us an additional $750 in accounting fees to prepare our taxes. Then, we also asked that the voluntary withholding in the same amount continue for 2018. Wells Fargo agreed, but then did not honor the request.
Now we are paying quarterly taxes ourselves as a result (which, in this case, will be better for us given the incompetency of Wells Fargo). Despite our pleas and the advice of our accountant, the congregation has refused to switch to a competent payroll company, so we are stuck with Wells Fargo, at least for the time being.
Product or Service Mentioned: Wells Fargo Payroll Services.
Reason of review: Problems with payment.