Managing employee payroll is a challenge for most small business owners. It’s important that you understand every step of employee payroll and take every measure necessary to ensure accurate recording and payment. There are many small business solutions available to assist with this effort, including software. However, there are some things to consider when selecting the right program for your company. For example, there are many free employee payroll programs available online. Are they worth using?
Most small business processing payroll with the use of computers has come a long way from the days when paper and pencil were the only tools used. Today’s small business payroll systems run on complex applications. They offer complete accounting and payroll capabilities to streamline the entire process. The employee payroll record allows finance and accounting personnel to access the data they require quickly and easily, from any location. The location needs to be safe and out-of-the-way to other staff members.
Small business payroll processing software provides the capability to manage all aspects of employee payroll. This includes managing pay periods, deductions, bonuses, taxes, insurance, bank accounts, EINs, much more. There are even applications available that allow you to process sales tax automatically. No longer do you need a human resource employee to manually enter these numbers each pay period.
Another option available in this type of software is direct deposit. This saves the small business owner time by eliminating the need for an employee to wait until his or her next paycheck date. Direct deposit automatically funds an employee’s account on the date he or she usually gets paid, providing a small business with an additional payroll expense. Depending on your company’s banking system and banking partner, you may also be eligible for free debit cards or free checks when you are hired. No extra postage is required to complete this option.
These employee payroll files also allow your accounting staff to quickly find employee information for payroll requirements, such as absences, sick days, vacations and more. The accounting staff can enter this information into the software and have it appear immediately on their computer screens. The employee information can include pay slips, tax returns, vacation information, fringe benefits and more. The accounting staff can print a report for the entire company, view the employees who worked the most hours and print a report for each employee individually.
With employee payroll programs, you can create an electronic pay stub. This pay stub is an electronic form that the employee submits to the employer or pays into their personal account electronically. When the employee sends in their federal income tax return, it will be deposited into their account electronically and will appear on their next pay stub. You can use any of the available pre-formatted employee payroll forms, including the 1040, W-2 form and the EIC form. In addition to providing the electronic receipt, you can also include a hard copy of this receipt for the employee to keep.
Another popular method used by small business owners to report their federal and state employee payroll taxes with the Internal Revenue Service is to use pre-formatted IRS tax tables. Many small businesses are unaware that they are eligible to take advantage of these pre-filed IRS tax tables. If you are using a pre-filled IRS tax table, you must provide the IRS with your Social Security number, date of birth, driver’s license number and taxpayer information.
The easiest way for small businesses to track all of their employees’ wages is to utilize the online payroll processing services provided by many tax agencies. The online payroll processing services will save you from having to print out paper paychecks and labels for every employee. Instead, you will only need to input the employee’s data into the secure online interface of the system. You will be able to view all of the employees’ data in real-time, and determine if they are being paid their minimum wage or if they are owed extra. In addition, the online services will automatically deduct the appropriate amount of federal and state taxes from each employee’s wages, thereby reducing your overall cost of providing payroll to the Internal Revenue Service. These online payroll processing services are available to U.S. taxpayers who meet the minimal qualifications required by the Internal Revenue Service.