Handling payroll can be a tedious chore for the manager who doesn't understand the payroll laws. There are several payroll software programs available that can help your or your staff handle payroll. Payroll software includes everything you need to calculate payroll and file your taxes each quarter and at the end of the year. One great thing payroll software can do is record employee attendance by integrating with time sheet systems. Some payroll software has its own attendance system where an employee will "clock in and clock out".

Having a time tracking system built directly into your payroll software is so beneficial because you don't need to worry about figuring out the exact time your employees came to work and the time they left. You can use the data to create an attendance record to show your employees. Payroll software includes numerous other benefits that can help your business grow. You can use payroll software to create an in-depth analysis of staff costs across multiple departments and as the business as a whole. One of the greatest benefits of payroll software is that you can easily print reports and paystubs in case you get audited. With most payroll software you can even track other employee information such as retirement accounts, sick leave, and vacation leave.

Small businesses without retirement accounts or insurance probably can get by without using payroll software. If you chose to do payroll on your own, keep good records in case you do get audited. There are some payroll systems that are straightforward and much cheaper than larger payroll software like QuickBooks. The downside to cheaper payroll software is that it usually doesn't calculate your taxes or prepare W-2s. Most payroll service requires that you have an annual subscription so it can receive regular tax law updates, National Insurance rates, and changing legislation that has a direct impact on payroll calculations.

When you are discussing purchasing a payroll software program, you need to determine who will be using the software. QuickBooks and other payroll software companies offer free trials so you can evaluate if the software will work for you or not. If you plan to have someone else using the payroll software, you need to have them help choose the software. Find payroll software that is easy for you to understand and is easy for them to use. The payroll software should be easy enough for you to use in case the person in charge of payroll leaves. You will be responsible for training the new person so you need to be able to use it when they are gone.

If you don't want to deal with payroll at all, you can always out source your payroll needs to an online service like Paychex. Online payroll companies provide excellent service, as they take care of all your payroll needs and they even calculate your quarterly and yearly taxes. Most online payroll companies will even prepare, print, and mail your W-2s.

How to select payroll software

So how do you decide which payroll software program will fit your needs? Here are some steps to choosing the right payroll software:

Step #1

Decide what your budget is. Can you afford to purchase the best payroll software and then pay a yearly subscription fee to keep it?

Step #2

How many employees do you have? Some payroll software programs are designed for smaller companies (fewer than 10) and others are designed to hold hundreds of employee's records.

Step #3

What do you want your payroll software to do? Do you want the payroll software to take care of your quarterly and annual taxes? What about you're W-2s? You need to decide what additional features you need the payroll software to do and begin looking for different options.

What does good payroll software include?

When you are shopping for payroll software, you need to look for the following:

• Create and manage company details, employee details, and tax details.
• Create standard tax reports and update tax forms on a continual basis.
• Overtime allowance and end of the year deductions.

Your payroll software should reduce the amount of paperwork you need to do. Payroll software should have security features set in place so you lose confidential information. Some payroll software includes purchase ledgers or a general ledger. A purchase ledger is a must for any business as it shows the costs of your business, the payment of your employees, and the cost of taxes.

Good payroll software should include some form of user training. Some programs include software training from a CD-ROM while others may have an online training class. Be sure to ask about the technical support options as well. You need software that allows you to get support any time you need it.

Payroll software on the market

Now that you know how to select payroll software, let's look at the best payroll software solutions on the market:

Intuit Payroll

This payroll software is one of the best on the market and is a perfect solution if your small business is running QuickBooks. With Intuit payroll, you will enter your employee's hours and Intuit will automatically calculate your employee's earnings, payroll taxes, and deductions. You can print the paychecks from your computer or you can use the Direct Deposit feature. Intuit will also calculate your Federal and State taxes and remind you when it is time to pay your quarterly and yearly taxes. You can e-pay your taxes through Intuit for no extra charge. The nice part about Intuit is that it will automatically fill in the tax forms for you so all you need to do it print them, sign them, and mail them. The cost to purchase Intuit payroll is free for the first 3 months and then $29.99 a month after that.

 Payroll Software by Medlin Software - You can download this payroll software in less than 5 minutes and there is no cost to try the software. Within a few minutes you can set up your entire payroll and begin printing paychecks. You can order blank check forms from their web site for a small cost. Medline software will also help you with your taxes and will print your W-2s. There is not a monthly cost to use this software; you simply pay $50 a year to use the software.

CheckMark Payroll - Another great payroll software is CheckMark Payroll. This is a great payroll solution for any business that has between one to 500 employees. It can easily integrate with QuickBooks and other accounting software systems. With this software, you will set up all your employees using a standard template, and then you can automate payroll calculations for every employee. CheckMark Payroll comes loaded with the latest tax tables and Federal income tax laws. You can even prepare your W-2s with this software and file them electronically. CheckMark even prints checks, W-3s, and Form 941. You can set up direct deposit with CheckMark using an internet connection. If you have a time-clock software program, CheckMark can import these hours and calculate their paycheck, it also includes options for sick and vacation leave. With CheckMark, you will get 60 days of free technical support and then have the options to purchase a technical support package. CheckMark Payroll costs $190.00 and is compatible on Windows or Macintosh.

VersaCheck Payroll - VersaCheck payroll includes vacation and sick leave accruals, pay frequency, and overtime. The downside to VersaCheck Payroll is that it does not import data from other accounting programs. VersaCheck Payroll includes retirement account planning and flex spending accounts. This makes it easy for you to keep all of your employee documents in the same file. Another benefit to VersaCheck is that it will send you email reminders and create a to-do list when payroll processing and tax payments are due. You can print the checks for your employees or you can utilize direct deposit. You can even link to Qchex.com through VersaCheck and have your paychecks mailed to your employees. VersaCheck includes printable W-4s and I-9s and links to other web sites to get state and federal updates. You can subscribe to a 1099 service for $20 a year too. If you have QuickBooks, VersaCheck can export your payroll and tax data to it. It also sends information to Quicken and Microsoft Money.

Payroll Mate - Payroll Mate is great software for a small or medium sized business. You can purchase Payroll Mate for $99.00. Payroll Mate will automatically calculate all your payroll needs such as net pay, federal tax withholding, Social Security tax, Medicare, State taxes, and local taxes. With Payroll Mate, you can establish different pay periods print checks. Payroll Mate also allows you to prepare Forms 941, 940-EZ, W-2s and W-3s. Payroll Mate is available for Windows operating systems and is a great solution for your payroll needs.

There are several other payroll software programs on the market so just be sure to check out 2 or 3 different ones before you pay money for one that may not be the best out there. Always remember who will be using the software and make sure it is easy for everyone