Payroll services for small business has become big business. Payroll service providers have come out of the woodwork and give business owners a slew of providers and software to choose from. As with most things in life and business, not all payroll service providers are created equal. Business owners and controllers need to be cautious and diligent in the decision to outsource their payroll responsibilities.
The IRS states "Outsourcing payroll duties can be a sound business practice, but employers who outsource some or all of their payroll responsibilities should know the employer is ultimately responsible for the deposit and payment of federal tax liabilities." The employer, not the service provider, is the responsible party for all taxes, penalties and interest. The IRS aggressively goes after payroll related taxes, more so than any other type of tax. Diligence in selecting your payroll service provider is extremely important.
A great place to start your due diligence in selecting a payroll provider is with your Certified Public Accountant. Your CPA works with many business entities and probably knows many payroll providers personally. Your CPA can make solid recommendations to you based on experience and personal knowledge. In fact, your CPA may offer payroll as a service. This has become a trend with CPAs because of the great influx of fly by night payroll service providers that have sprung up across the nation. CPAs are spending more and more time correcting payroll errors made by these payroll services and their clients are paying small fortunes in fees, penalties and interest as a result of mistakes made by the payroll providers.
Partnering with the right payroll provider will give you peace of mind by assuring your compliance with the taxing authorities and will save you both time and money. Business Payroll Solutions is an example of the type of payroll partner CPAs recommend. Over ninety percent of their clients are direct referrals of CPAs. Business Payroll Solutions was developed by a team of Certified Public Accountants and this is one key aspect you want to look for in your search for the right payroll partner for your business. Other key indicators of a CPA involved payroll service provider include:
Rhonda Reed, CPAThe IRS states "Outsourcing payroll duties can be a sound business practice, but employers who outsource some or all of their payroll responsibilities should know the employer is ultimately responsible for the deposit and payment of federal tax liabilities." The employer, not the service provider, is the responsible party for all taxes, penalties and interest. The IRS aggressively goes after payroll related taxes, more so than any other type of tax. Diligence in selecting your payroll service provider is extremely important.
A great place to start your due diligence in selecting a payroll provider is with your Certified Public Accountant. Your CPA works with many business entities and probably knows many payroll providers personally. Your CPA can make solid recommendations to you based on experience and personal knowledge. In fact, your CPA may offer payroll as a service. This has become a trend with CPAs because of the great influx of fly by night payroll service providers that have sprung up across the nation. CPAs are spending more and more time correcting payroll errors made by these payroll services and their clients are paying small fortunes in fees, penalties and interest as a result of mistakes made by the payroll providers.
Partnering with the right payroll provider will give you peace of mind by assuring your compliance with the taxing authorities and will save you both time and money. Business Payroll Solutions is an example of the type of payroll partner CPAs recommend. Over ninety percent of their clients are direct referrals of CPAs. Business Payroll Solutions was developed by a team of Certified Public Accountants and this is one key aspect you want to look for in your search for the right payroll partner for your business. Other key indicators of a CPA involved payroll service provider include:
- You are given a personal dedicated payroll specialist who you will communicate with each pay period. Your payroll specialist will get to know you and your business resulting in superior personal service. Your specialist will be able to recognize problems in your payroll file before they happen.
- You are given access to a Certified Public Accountant. The on staff CPAs provide you with an invaluable resource.
- You are not the only party with "skin in the game". The IRS holds the business owner responsible and the IRS also hold CPAs responsible. CPAs are registered with the IRS and are held to a higher standard by the IRS. The only others held accountable by the IRS to this degree are attorneys and enrolled agents.
- Your payroll taxes are not impounded! A CPA knows the value of your money and the importance of cash flow. (Did you know that the national payroll providers make more money from impounding your payroll taxes than from providing payroll services?)
- You will stay off the IRS radar.
Rhonda has worked for local, regional and international accounting firms. Her guiding philosophy is that a CPA should do more than simply keep track of numbers and prepare tax returns, so Rhonda routinely educates and empowers her clients with the financial knowledge and understanding that it takes to grow their business into a success. With 17 years of audit and tax experience, Rhonda is truly an educator and advocate of the small business owner.
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