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What About Payroll?
written by Steven Bristol on October 20th, 2008
Another installment from the best accountant in the world, ours.
Now that you have employees what do you do?
DO NOT just go out and buy a well known payroll software package and start printing payroll checks.
Remember my first article utilizing KISS (keeping it simple at startup).
Sole Proprietors:
If your business is just starting up and you anticipate more than two employees. Find a reputable payroll leasing company and dump the entire problem on them. Yes, it will cost you a little more for each payroll but just add the extra cost to your bidding process. By leasing your employees the leasing company takes on full responsibility for all of the State and Federal reporting and insurance requirements. Also, your small number of employees could have access to large group health insurance and other fringe benefits for a smaller fee than you can offer.
Corporations and LLCs:
If your business is just starting up and you anticipate more than two employees. Find a reputable payroll processing firm who will assume all of the record keeping and reporting requirements from you. You will still be ultimately responsible in the IRS eyes for your payroll but will have professionals to help you along the way.
In both cases, when you feel comfortable about all of the State and Federal payroll laws then you can start looking for an in-house software solution. Do not depend on your internal bookkeeper because you are ultimately liable and need to know how records, reporting, tax deposits and required insurance should be done in order to C.Y.A.
Everyone with less than two employees, just let your tax professional or C.P.A. guide and help you in the payroll reporting and form processing requirements on a quarterly basis.
Remember focus on building your business not creating paperwork.
2 Responses to “What About Payroll?”
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Steven, That’s good info. I’ve never heard it put as succinctly as you did. I especially like the “Do not depend on your internal bookkeeper ” – most folks don’t realize whose ultimately responsible for things being done right.
That’s the kind of info you don’t get in school (except for the school of Hard Knocks). I’m sure there are lots of small businesses around that don’t read the less everything blog, but could use this information. Many, many years ago, my Dad had a small logging business, and I remember he and my mom struggling to understand what was required even back then.
I’ll bet there are quite a few lawn service companies around that fall somewhere around your “two employees” threshold.
Hey guys, my accountant told me about a nice Payroll Program that I wanted to share with you, the name of the solution is Payroll Mate, and you can download a free demo if you want to from the link below: Payroll Software Download Using this software you can calculate net pay, federal withholding tax, Social Security tax, Medicare and state payroll taxes.