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Why
You Should Consider

Typically,
employers have two basic payroll processing options - use an in-house
method or outsource the work to an independent payroll service
1.
IN-HOUSE PROCESSING - Payroll can be processed in-house using either
a manual process or a payroll software program. Employee payroll obligations,
payroll deductions, and payroll tax liabilities are calculated, check
are written or generated, and payroll related information is recorded
or updated to the general ledger. In most instances, taxes are filed
manually. Some employers hire an accountant who specializes in payroll,
sometimes only the purpose of calculating or filing payroll taxes/reports.
2. OUT SOURCE TO PAYROLL PROCESSOR - Payroll service bureaus provide
payroll functions that range from basic calculating of employee payroll
and tax liabilities, producing checks, and preparing management reports
to other services as preparing and filing tax obligations, quarterly
reports and year-end W-2's.
Which
is right for you and your business?
The payroll method that's right for you depends, in large part, on the
complexity of you payroll and the actual time and resources it takes
to prepare it. Here are some factors to consider for each method.
OUTSOURCE TO PAYROLL PROCESSOR
* Have
trained personnel to perform payroll-related responsibilities
*
Perform wage and hourly calculations
*
Perform Federal, State, Local tax calculations
*
Track payroll tax deposit due dates
*
On top of the ever changing tax rules and regulations
* Calculate
ongoing tax liabilities
*
Calculate and file payroll tax returns
* Provide other service (I.E., automated tax payments, direct deposit,
human resource service including employee benefits)
IN-HOUSE
METHOD
* Use
personnel(s) for payroll versus other business tasks
* Entail software related costs (purchase and upgrades)
* Involve costs to train personnel(s) to use software
* Involve costs associated with hardware (less depreciation) and related
maintenance if using a dedicated or shared payroll computer system
* Cost of supplies (Special MICR toner for checks, special checks for
software package, envelopes for checks, paper, etc.)
Advantage of Using an Outside Payroll Service
FOCUS
- by using an independent payroll service, an employer can better focus
on what they do best; running their business
ACCURACY - a top priority of any payroll service is
ensuring the accuracy of the payrolls they process. Staying current
with tax laws and tax calculations is a vital part of the business
CONFIDENTIALITY - payroll services reduce the risk
of exposing confidential payroll information to unauthorized personnel
CONVENIENCE - outsourcing makes payroll fast and easy.
In general, all an employer has to do is gather and communicate payroll
information to the payroll service
FLEXIBILITY - an employer has access to a greater number
of services. This has become increasingly important, as the administration
of other functions (I.E., retirement plans, direct deposit, and insurance)
has become part of the payroll process
How
to select a payroll processing company
Most business owners understand how much work is required to take care
of payroll preparations, employment taxes and record keeping. Outsourcing
you payroll keeps you in control of your payroll without the headaches.
And with some savvy shopping, you can find a payroll company that will
best take care of your needs!
Payroll processing is a competitive market and prices usually reflect
local market conditions. Be sure to ask for the cost of only those services
that you need. In additions, consider all options, not only the per
pay period charges, watch out for the "Hidden Charges."
Customer service is important, know whom you're dealing with. Is it
a sales rep in your market, where the work is generated on the other
side of the state, or a local company servicing the needs of the local
market?
Questions
to ask when shopping for a payroll service
1.
Basic Payroll Service - what's included, what's not?
2. Tax Filing Service - is it offered, and how safe is it?
3. Direct Deposit - can we offer this to our employees'?
4. Check Preparation - is it available; laser signed checks?
5. Data Collection - how do I report our payroll?
6. Human Resource Service - what is there offered?
7. References - what others clients have to say!
8. COST - What will this all cost?
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