You are smart enough to manage your own payroll, but should you?

If a business is going to get in trouble, this is a big one. Great lesson n. # 1 – Once you run payroll, fiduciary taxes (withholding, FICA, and Medicare) no longer belong to the business. If you do not file the corresponding returns on time, there are fines. If you don’t turn in the trustee’s taxes on time, there are interest and penalties involved and the IRS will put a link to your assets and threaten sixteen all. The Boston Business Journal publishes all violators and how much they owe on a regular basis. Some of the published amounts are incredible.

There are many ways to run payroll:

Less Wanted: Excel Spreadsheets – Come on folks, this is not good!

Unless you are hiring / training payroll staff, this is the second least desired – your software calculates it for you, but you do the rest. For example, you can buy an annual subscription to QuickBooks or Peachtree (I’m sure there are many others). What is provided are up-to-date tax tables, as well as federal and state payroll reports. You enter the hours, print the checks, file the reports, make the tax deposits, file and pay your state unemployment obligations, etc. All of this must be set up by you or someone you hire. You can also configure it for e-file.

So what is the problem? Not understanding payroll setup is one, not understanding how the software works is another (I’ve seen a lot of double payroll bookings), and here’s the most important one: cash flow! If you have a quarterly schedule, the bill when due can be quite large and the company has used the money for something else that it cannot legally do. And don’t forget about confidentiality.

Most wanted: external payroll service; if this costs money! Decide what you need and compare prices. It generally depends on the number of employees and the frequency of payroll runs. For example, 3 employees paid biweekly is much cheaper than someone with 100 employees who pay weekly. I’ve heard quotes from $ 35 per month to $ 200 all things being equal.

I can talk about QuickBooks because it is where I have the most experience. They will help you every step of the way in setup. The hardest part is the setup because Intuit must meet all the requirements. Everything must be in order, that is, TIN, payments and updated reports if it is not a new payroll, state information, etc. Once set up, just enter the hours and send to Intuit over the internet, and they do all the rest! You just have to contribute the money in cash! Doing it this way also accomplishes accounting!