Many Americans have made the choice to leave regular 40 hour per week jobs and start up their own business. These small business owners are the backbone of America’s economy. They employ thousands of Americans.
Owning your own business can be an answer to prayer or a dream-come-true. But when it comes time to pay your employees, that portion of being a small business owner can be a bit intimidating. You want to make the job as easy as possible and still be sure that it’s done correctly and with great accuracy. However, these days the problem is easily solved with payroll software especially designed for your small business needs.
There are many brands of small business payroll software on the market today. Choosing the one that’s right for you may be your biggest challenge. Here are a few things to take into consideration:
- Number of employees- size of business
- Type of business- Do you maintain an inventory?
- Will you need to file your own Form 941, 944 and 940?
- Will you want to be able to print out and mail W-2 and 1099 forms at year’s end?
- Does your company need to file state income taxes?
Some small business owners hire a Certified Public Accountant to do their taxes and to file all tax related documents. Even then, your CPA will need records of names, addresses and tax information on those your company employed during a tax year. In order for these records to be created, your company will need some type of small business payroll software.
If you are planning to hire a Certified Public Accountant to do most of the tax related paperwork for your company, then it is a good idea to meet with your CPA and discuss the best type of software that will meet all your business needs.
A small business is normally defined as a company, which employs fewer than 25 people. There are many software packages today that would accommodate this number of employees. If you are planning to hire a payroll staff and do what is referred to as “in-house” payroll, then here are a few things to consider:
- Make sure that the payroll software can handle all your deductions. Can it handle reimbursements and employee loans, for instance? Is the small business payroll software capable of setting limits on deductions? Will it handle end of year resets?
- Determine your company’s earnings categories. Make sure the small business payroll software will support all of these categories.
- Does the small business payroll software allow you to file taxes using stored information from the previous year’s records? Will it handle Earned Income Credits (EIC)?
- W-2 Forms – This is a critical factor to consider. Make sure the small business payroll software you are considering will allow you to print out W-2 and 1099 forms to mail to your employees unless this is to be done by your CPA.
- Direct Deposits are becoming more popular. Over half of today’s employees request direct deposit, so this is an important factor.
- Does the small business payroll software allow you to print out reports of all activities? Printing payroll reports is an important tool in budgeting for your company.
- Make certain that all your financial records will be completely secure. These days, there are unscrupulous people everywhere searching for a weakness in our computers, so that they can break in and steal information.
Companies and stores that sell small business software usually have people on staff who can answer most of these questions. Many software manufacturers will even send one or more of their personnel to your business to help you install their software and get it set up. They can stay on site for several days and train employees in the use of the software. This can be very helpful and will get your company’s payroll department up and running quickly and efficiently.
When considering small business payroll software, be sure to inquire if this is a service that their company could provide to your company. This would be a service worth paying a little extra for if necessary, although you may be able to negotiate this as part of the sales price.
One last item worth considering when purchasing small business payroll software is the type of payroll check stock the software will accommodate. You will want your payroll checks to be attractive and include all the necessary information regarding withholding amounts and other such data. But it’s a good idea to inquire about the cost of the payroll check stock. Using something expensive could turn out to be a costly mistake. Will the payroll check stock run through an ordinary printer or will a special type of printer need to be purchased?
It’s a good idea to make a list of questions that you, as a small business owner, feel are important and have that ready as you begin your search for the right small business payroll software for your company. The job will be much easier and less stressful.