Duplicate Tax Filings Overview
When Toast Payroll file quarterly federal taxes and we're rejected for a duplicate tax filing, we receive this message:
"Taxpayer TIN in the Return Header must not be the same as the TIN of a previously accepted electronic return for the return type and quarter-ending period indicated in the tax return."
Toast Payroll most often sees this when customers fail to inform their prior provider/accountant of a change in payroll service and the prior provider files with incomplete information. Since Toast Payroll is the source of truth with a full quarter's data, whatever was filed probably didn't match what was paid throughout the quarter in the duplicate filing.
Customers should take immediate action to end the relationship with the prior provider (who may be filing on your behalf) in order to prevent this from happening again and avoid future impacts. These impacts could include overpayments or underpayments that aren't in line with your correct filing.
What Happens When There is a Duplicate Tax Filing
What happens when federal taxes we're rejected for a duplicate tax filing:
Once Toast Payroll's e-filing is rejected, we immediately file a paper return.
However, the IRS may process the prior provider's incomplete e-filing in the meantime and see that as an overpayment. They may then process an overpayment check and send it to the customer.
Once the IRS receives our paper filing, they will take steps to process and compare the electronic filing in error and the paper filing from Toast Payroll.
The IRS will determine which filing to move forward with.
If Toast Payroll's paper filing is accepted, then the IRS will align your payment amounts with the quarter. If this happens, you will want to do two things (see next section).
What Customers Should Do When There is a Duplicate Tax Filing
Follow the steps below when there is a duplicate tax filing:
End your relationship with the prior payroll filer. Specifically, tell them to stop filing your company's taxes - this prevents future occurrences of this situation.
Do not cash any check received from the IRS for the period in question.
Pro tip: Write VOID on the face of the check and return it to the IRS. This is to show that once the IRS does process Toast's return, the funds are still with the IRS and you won't get a notice for underpayment.
If Toast Is the Previous Provider
If Toast Payroll is the payroll provider you're leaving (not the one you're switching to), the steps above don't apply to you. Your new provider will need accurate quarter-to-date information from Toast Payroll to file correctly, and you should confirm with Toast Payroll support that Toast has stopped filing on your behalf for the quarters your new provider will cover. Contact Toast Payroll Care via the blue chat button in the lower-right corner of any page to coordinate the handoff and avoid a duplicate filing on the other side. If you no longer have access to Toast Payroll, you can still reach us by calling (312) 252-7341.
This content is for informational purposes and is not intended as legal, tax, HR, or any other professional advice. Please contact an attorney or other professional for advice.