HomeBookmark Info.comMake Info.com your HomepagePlugins Visit other Info sites:
Info.com - Your independent search platform...
WebTopics
ResearchJobsFlightsImagesVideosShopmore


Payroll Software

Learn about payroll software and the options these programs offer.

Payroll software can save small and large businesses time and money. [©Jupiter Images, 2010]
©Jupiter Images, 2010
Payroll software can save small and large businesses time and money.

Payroll software is an essential tool for any business that employs at least three people, and some programs are designed for businesses that employ thousands. Preparing payroll is a time-consuming task that requires accounting skills and knowledge of state and federal tax laws to properly calculate withholdings. If prepared incorrectly, entrepreneurs can expect to deal with disgruntled employees, in addition to fines from the Internal Revenue Service (IRS). In fact, it is estimated that 40 percent of small businesses pay an average of $845 in late or incorrect filing fees each year.

Payroll software can eliminate many of these headaches. Moreover, since payroll software tracks employee withholdings and calculates employer payroll taxes, many services make the short leap to help businesses file tax forms as well. Some programs simply provide quarterly and year-end reports with the final numbers; others populate tax forms that are ready to be printed, signed and mailed; and still other services file automatically and will even represent a company if an issue arises with the IRS. According to the IRS, employers are ultimately responsible for making sure payroll taxes are filed correctly. By registering with the Electronic Federal Tax Payroll System (EFTPS), they can directly confirm that payments have been made.

Accounting Software, Payroll Software and Compatibility

For most small business owners, it makes sense to choose a payroll software module that integrates with an in-house accounting software program or an accounting program that includes a payroll function. For instance, Intuit's QuickBooks software includes a payroll feature, as does Microsoft Accounting Professional and Peachtree from Sage Pro Accounting. Conversely, SurePayroll is a software program that works with MYOBs accounting products. There are also some online payroll services that can import data into accounting programs, like Paychexs Online Payroll.

Because there is such a variety of choices, finding the right payroll solution requires a business to analyze a number of factors. First and foremost, the software must be able to calculate withholdings in the businesss jurisdiction and be able to handle any of its unique payroll issues, such as special deductions. The software should be easy to work with, and so it is important that business owners consult with human resources and accounting personnel who handle payroll. Some programs are geared toward accountants, while others are designed to suit do-it-yourselfers.

The payroll software should either integrate seamlessly with the company's accounting software or be able to import and export compatible files. Otherwise, it will take in-house expertise to massage data files so that the payroll numbers can effectively be made a part of the larger accounting picture. The software should also allow users to customize reports for their industry or according to their preference.

Popular Payroll Software Packages

In the world of comprehensive accounting packages, there are four major contenders, all of which include a payroll feature. These programs are Intuit's QuickBooks, Microsoft Accounting Professional, MYOB Premier Accounting and Peachtree by Sage Complete Accounting. Microsoft's program has a nice interface that is easy for Windows users to navigate; however, the program itself does not calculate payroll taxes. Instead, Microsoft offers a Manual Payroll Calculator that is basically an extension of Excel. To offset this, Microsoft does offer a Payroll for Office Accounting service that prints checks and prepares taxes for a fee.

PC Magazine rated QuickBooks the best program for its many features and easy-to-navigate interface. Its five payroll options all integrate seamlessly with the rest of the accounting suite to eliminate error and limit the time employees spend punching data. Owners of very small businesses that have three employees or fewer will want to look at Basic Payroll, which helps users import timesheets and develop employee records but provides no tax help. For that, there is Standard Payroll, which prepares printable federal forms; Enhanced Payroll, which handles state filings; and Assisted Payroll, which submits both state and federal filings automatically. All of these packages provide check printing and direct deposit for a small fee per transaction.

Peachtree by Sage Complete Accounting offers three levels of service. Full-Service Payroll requires a monthly subscription, but in return it processes payroll automatically and prepares and files tax forms. The Tax Update Service may be just the thing for small businesses on a budget. For a yearly subscription, users get print-ready tax forms using payroll data already in the system. E-Filing Advantage is an additional service that users can purchase to file the forms automatically.

MYOB Premier Accounting is unique in that it provides the do-it-yourself payroll option and partners with SurePayroll for users who want to outsource the task. HR World reports that SurePayroll is the costliest of such services, but it will also represent companies who have payroll issues with the IRS. Going the SurePayroll route takes all the hassle out of calculating payroll. Businesses simply need to report how many hours employees work, and the service calculates the rest.

Related articles

Search the Web

We are not lawyers or legal professionals, nor are we financial counselors or professionals. The content of this Web site is intended to provide general information and advice. Prior to making any legal or financial decision, you should consult a licensed professional. For more information see Terms of Service/Usage Agreement.
Home   |   About   |   Media Comments   |   Legal & Privacy Policy   |   Tell a friend   |   Contact
Copyright © 2012 Info.com – All Rights Reserved.