Cheap payroll services for freelancers and small businesses
What is a payroll service provider?
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- Prepare the paychecks for the employees of a business
- Put together paystubs
- Create Forms 940, 941, 1009, and Employer's Annual Federal Unemployment (FUTA) Tax Return
- Employer's QUARTERLY Federal Tax Return using the employer's EIN for signature by the employer.
- File Forms 940 and 941 using the employer's EIN.
- Make federal tax deposits and federal tax payments for the taxes reported on Forms 940 and 941 using the employer's EIN.
- Prepare Form W-3, Transmittal of Wage and Tax Statements, and file and furnish Forms W-2, Wage, and Tax Statement, for the employees of the employer using the employer's EIN.
Types of payroll systems
Software Managed Payroll Systems
Software-managed payroll systems are one of the cheapest ways to create financial documentations. They are easy and quite fast to use with growing technologies. Websites like Paystubsnow help you create Check stubs, 1099, invoices, and various other financial supporting documents without needing payroll service companies. However, using this method requires that you have a basic knowledge of payroll management. Typically you will have to manually enter employee details into whichever payroll software you use. This will also require you to keep your record of employee details such as hours logged, hourly rates, and others.Professionally Managed Payroll Systems
Professionally managing your payroll system requires you to hire virtual bookkeepers or accountants. With service professionals out there, you can easily hire one on a contract basis. This is probably the second less expensive method for small businesses. This way, you only have to pay when you need the job done. If you do your books once a month, that would mean having to pay just once a month as well.Internally Managed Payroll Systems
An internally managed payroll system is for small businesses with medium-sized employees. This method of payroll management is also sometimes combined with a software payrollee system. Since the number of employees is mid-range, you can easily compile and create the necessary documentation yourself while also relying on a few tools for creating invoices, paystubs, and others. As a solopreneur, this is also one of the best methods for your business. You can generate unique and customized invoices, create paystubs, 1099, and more all by yourself.Payroll Services Managed by Payroll System Agencies
This is typically the service hired by big companies for their payroll needs. These agencies cover everything from generating paystubs, applying deductions, taxes, and paying employees. This is perhaps the most accurate form of payroll system but also the most expensive by any standard.Should I hire payroll services?
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