Payroll Preparation ServicesThough many small businesses prepare their payroll manually, others use payroll preparation services. These services get most of their business from companies with 20 or fewer employees. Using such a service helps you by giving you more time to concentrate on your own business, and maintaining complete payroll records for you. It can also help you avoid tax problems by providing a highly accurate method of payroll preparation. Information the Service Needs from YouIn order for the service to set you up in its system, you will have to provide them with certain basic information, including the names, ID numbers, and pay rates of your employees. You’ll also need to indicate whether each employee wants to receive a check or to have a direct deposit made to his or her bank account. Each pay period, you will report to the service the payroll hours for each employee. Usually this can be done by phone, fax, computer, or the Internet. What the Service DoesPay Employees: Using the hours you report, the service will write (and deliver) checks and/or make direct deposits to employee accounts. Handle Taxes: The service will calculate, deposit, file, and reconcile payroll taxes. Produce Reports: Standard reports produced by these services include payroll register, payroll tax summary, month-to-date tax summary, and master list of employee information. Other Services and Benefits: The service may also:
FeesSet up fees: This fee usually runs about $100, but can also depend on the number of employees you have. Don’t be afraid to ask if the service to waive this fee or the charges for the first couple of payrolls -- they have lots of competition, and may be willing to give you a deal to get your business. Per-employee Rate: The number of employees being processed dictates the rate you pay -- the lower the number, the higher the rate per person. Here’s an example of the per-payroll fees for an business with 11 employees that pays its employees every two weeks (bi-weekly schedule).
Sample fees for additional services:Personal delivery................ .6.00 Overnight.............................15.00 New hires.............................. 2.00 (to set up in the system) Internet.................................10.00 (per month for portal access, such as e-mail) Process year-end W-2's........ 3.00 (per employee) Thanks to the following firms for providing SCORE with this information.
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