Payroll Processing
How to process payroll – step by step
Processing payroll isn’t just about compensating your employees. It’s part of operating your business legally—according to state laws and the Fair Labor Standards Act (FLSA). The FLSA has several requirements that fit into your payroll process—from tracking employee time at work to recordkeeping. You’ll want to keep those regulations in mind when establishing a payroll process.
1. Choose a payroll system
There are three basic payroll systems: manual payroll, outsourced payroll, and payroll software.
Manual payroll is processed by hand, typically on paper or in a spreadsheet.
Outsourced payroll means hiring someone else to take care of everything from payroll taxes to bookkeeping.
Payroll software varies by plan or product. Most offer everything from basic payroll assistance to additional payroll services that may include time tracking or even HR services.
Before you commit to one system over another, consider factors like business growth, employee benefits, and the complexity of your state’s payroll taxes and laws. The more complicated the components and calculations, the more likely it is you’ll want to purchase a payroll software or outsource payroll altogether.
Using a payroll company is not obligatory but highly advisable. Many shluchim opt to file a 1099 for their salary and separately declare parsonage when filing taxes, preferably with an accountant. If handling others' salaries, the process differs.
For self-payment, checks with a year-end W2 filing through a website suffice. Consult an accountant for potential 941/944 filings.
You have the option to pay yourself via checks and utilize a website to file the W2 at the year's end.
Filing 941/944 forms might also be necessary. Consult an accountant or CPA for guidance.
Payroll companies streamline form submissions,simplifying the process, Some even offer free services.
Below are several options
(has a very good rate (FYI. They can match payroll4free prices and service is much easier to use, and for parsonage one can send for themselves a zelle payment.)