Are you ready to hire your first employee? Maybe you already have a few employees on your payroll but you’re thinking of bringing the operation in house to save money each month. I’m here to tell you that you may be better served to keep it out of your hands.
Most small business owners cite cost as the biggest reason to bring payroll back under your roof rather than keeping it with one of the many payroll providers that exist. Starting at around $50/month, the costs can add up quickly over the course of the year but before you switch consider what those costs pay for. Below are just some of the options that some payroll operators provide to assist your needs:
- Monthly and quarterly payroll returns
- Cutting and mailing paychecks, as well as tracking and paying any payroll “trust fund” expenses
- Managing your retirement accounts, health care, vacation, sick days
- Paying 1099 Vendors
- Filing W2s each year
- And dozens more features!
So how much is too much for a payroll service? It depends on your business structure and the number of employees. Keep in mind that just #1 above will easily take you about an hour (or more) of your time each month, depending on how familiar you are with your state’s filing requirements. If you’re an employer in the DC metro area then it absolutely makes sense to go the payroll provider route because they keep track all of your employees’ residences and the filing requirements in each state.
There are many payroll providers in the DC metro area and most of them are pretty similar, give or take a few features. When searching, I’d look for the following features:
- Automatic payroll form submission
- Direct deposit and automated payments
- Trust fund, health care, and retirement account set-up
I’m definitely a numbers guy and, when you start to think about the cost of each check, envelope, stamp and transaction fee in addition to the hourly time dump that comes with filing payroll returns, it is a no-brainer to have someone else handle those payroll returns for you.
QuickBooks Online users looking for more hands-on control should look at the Intuit Payroll options that connect directly to their online account. You’ve got to set it up initially yourself but once you’ve set it up all it takes is a click of the button each pay period to get your checks out. The handy reminders each period to pay your employees are big help too! Intuit has several payroll options but I prefer the Intuit Payroll Full Service produce for the most benefit, but you could get by with the “Enhanced Version” too. Try it for the first 30 days and see what you think!