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<< Click to Display Table of Contents >> Navigation: MLS 2026 Fully Integrated Accounting > Payroll > Payroll System Setup/Utilities > Payroll annual closing |
At the end of each payroll year:
👉 a Payroll Year-End Closing must be performed.
This process prepares the Payroll system for:
•the new payroll year
•new employee totals
•fresh payroll accumulation records
•year-end reporting separation
The closing process automatically:
•archives payroll history
•transfers records to historical files
•clears current-year payroll totals
for the upcoming year.
Throughout the year, MLS 2026 continuously tracks:
•employee earnings
•taxes withheld
•deductions
•payroll totals
•vacation and sick pay information
At year-end:
👉 these totals must be finalized and archived.
The Payroll Closing process creates:
•historical payroll records
•year-end archives
•clean beginning totals for the next year
while preserving prior-year information for:
•audits
•W-2 reporting
•payroll history review
•tax reference
To begin the payroll year-end process:
👉 select:
•Tools
•Closing
from the Payroll menu.
Because Payroll Closing is a major accounting operation:
👉 the system first asks for confirmation
before continuing.
This safety step helps prevent:
•accidental payroll closing
•premature year-end processing
•loss of active totals
⚠️ Be certain all payroll work for the year is complete before proceeding.
After confirmation:
👉 the system asks for the payroll year to be closed.
Verify the correct year carefully before continuing.
Once accepted:
•the closing process begins automatically.
During Payroll Closing, MLS 2026 will:
1.Move employee payroll records to history files
2.Archive year-end totals
3.Clear current payroll accumulation totals
4.Prepare payroll files for the new year
5.Preserve historical records for future reporting
This process is handled automatically by the system.
Before performing Payroll Closing:
•Verify all payrolls for the year are complete
•Confirm all payroll taxes are processed
•Print final payroll reports
•Verify W-2 information carefully
•Reconcile payroll totals to accounting
•Perform system backups
⚠️ Once the closing process is completed, current-year totals are reset for the new payroll year.
Before performing ANY year-end closing:
👉 create a complete backup of your payroll data.
This provides protection in the event:
•adjustments are later required
•reports need reprinting
•errors are discovered
•historical restoration becomes necessary
A verified backup is strongly recommended.
Payroll history is one of the most critical accounting records maintained by any business.
Proper year-end closing helps ensure:
•accurate W-2 reporting
•organized payroll archives
•clean payroll totals
•simplified reporting
•long-term audit support
Skipping or improperly performing year-end payroll procedures can create:
•payroll reporting problems
•tax filing issues
•inaccurate employee history
•accounting discrepancies
This section works closely with:
•Payroll Overview
•Payroll Processing
•Payroll Reports
•Payroll Tax Setup
•Payroll Troubleshooting
•Year-End Accounting Procedures
Together, these sections provide a complete payroll processing and year-end management workflow within MLS 2026.