A Helpful Payroll Guide for Small Businesses

As a business owner, your first payroll was probably quite confusing. Also, manually processing your payroll often results in errors and miscalculations. With practice and repetition, it should have gotten easier, yet, is it still time-consuming. Being a small business owner, your time is precious and you can’t afford such mistakes and wasted time. 

Automating your payroll process can help take care of these issues in one go. However, if you aren’t ready to completely commit to taking your entire payroll online, using an online paystub generator is a step in the right direction! 

With an online paystub generator such as 123 Paystubs, you can drastically reduce the time it takes to create paystubs and distribute them to your employees. But, 123 Paystubs doesn’t just stop there! 123 Paystubs is more than just a paystub generator, you can also meet your quarterly and annual filing requirements with 123 Paystubs. 

Follow this helpful guide to get your payroll running and keep your business IRS-compliant:

Find Out the Legal Requirements 

Before you get ahead of yourself in the payroll process, you should begin by checking the legal payroll requirements for your state. The following are things you will need to do before beginning the payroll process:

You will need to register for an Employer Identification Number (EIN). An employer identification number (EIN) is a nine-digit number assigned by the IRS. The IRS uses the number to identify taxpayers who are required to file various business tax returns. So, without this number, you would not be able to pay your required business taxes. 

You should also become acquainted with your tax payment due dates and filing deadlines. Being aware of these deadlines will make the payroll process much easier. It is also good practice to work ahead of these deadlines to ensure you file on time and don’t incur any penalties from the IRS. 

Choosing a payroll schedule is one of the key decisions you have to make as a small business owner. A pay schedule will determine how often you pay your employees. Whether it’s weekly, biweekly or monthly, it’s important to determine so that you can guarantee your employees will be paid on time, every time. You must also understand and abide by all federal and state wage laws when creating your pay schedule and wage rates.  

Get Your Employees Onboarded

The first thing you should do when you hire new employees is to provide them with a W-4 form to complete. The W-4 helps keep track of your employees’ allowances and dependents. This, in turn, affects the amount of taxes to deduct from their paychecks. So, ensuring this is done is crucial to begin your payroll process and pay your employees correctly. 123 Paystubs will ensure your taxes are calculated accurately based on employees’ W-4 withholdings.

You will also need to take care of your new hire reporting and ensure that you classify your employees correctly. For your employees, you are expected to pay taxes, follow the minimum wage law, and take care of overtime wages. As for independent contractors, these things aren’t essential as they pay their own taxes. So, incorrect categorization may lead to owing back taxes and wages, penalties from the IRS, and interest.

Create Your Paystubs

When payday rolls around, you should provide your employees with paystubs. Paystubs are useful documents for both employers and employees, so they should be of professional quality. Using an online paystub generator makes creating paystubs quick and easy as opposed to creating them manually. 

123 Paystubs is an online paystub generator that allows you to create professional and accurate paystubs in a matter of minutes. 123 Paystubs provides a variety of paystub templates that can be customized to fit the exact needs of your small business. We make it easy to include additional income and deductions, year-to-date values, and FUTA and SUTA is required. 

As for paystub calculations, things like income taxes, year-to-date calculations, and Federal and State withholdings can be calculated and totaled for you. If you can enter the information, our paystub generator can do the rest. We can also easily differentiate your employee and contractor paystubs and ensure your contractor’s paystubs will not include any withholdings. 

Save Your Paystubs 

As we mentioned above, paystubs are important documents, so you should keep a record of your previous paystubs. Your paystubs can be used to show proof of income and help you file your annual taxes, so keeping them handy is necessary. With 123 Paystubs, your paystubs will be stored securely in your online account. This provides easy access to your paystubs and allows you to view them from anywhere. 

It’s Tax Time

Finally, as an employer, you are responsible for making payroll tax payments and producing certain reports. With 123 Paystubs, you can easily meet your quarterly and annual filing requirements. 123 Paystubs supports e-filing for Federal Forms 1099-NEC, 1099-MISC, W-2, and 941 with the IRS. 

E-filing tax returns with the IRS is far more convenient and efficient than paper filing. When you e-file with 123 Paystubs, you can ensure your forms are correct with our accurate calculations, built-in error check, and the ability to make unlimited corrections before filing. You will also receive your filing status instantly which is not an applicable feature when you paper file. 

Create Paystubs in minutes with 123 Paystubs

123 Paystubs is the perfect choice for those who handle and manage payroll on their own. With 123 Paystubs, you can create professional and accurate paystubs and ensure your business is IRS compliant. Take advantage of the best-in-class features to create paystubs quickly, easily, and at the best price. 

Visit https://www.123paystubs.com/ to learn more about generating paystubs online.