A payroll tax notice can feel like everything went wrong overnight, but the letter is usually the discovery point, not the beginning. Most notices trace back to a registration gap, a remote hire, a relocation, or a provider transition that happened months earlier. Here are the nine steps to take, in order, to trace the notice back to its actual cause and stop it from escalating into something bigger.

"We thought payroll was handling this" is one of the most common lines businesses say after a notice arrives, and it's usually true, payroll was running fine. The problem is that payroll processing and payroll compliance are not the same function, and registrations, work states, and filings depend on information the provider was never given. Here's why these gaps slip past even a provider that's doing its job correctly, and who actually owns closing them.