Saving $$ When Paying Payroll

by Scott Sturman MD

Zhangmu, Tibet - photo by JoAnn Sturman

Personal accountants often compute payroll schedules, determine monthly federal and state tax obligations based on salary, and file quarterly tax reports.  These tasks are easily done by oneself or with the help of a payroll company.  In these times of financial uncertainty this tactic will save money and time. 

I use a local company The Payroll People to take care of these issues, but there are other companies both with national and local affiliations which can provide the service.  After initially setting up one’s account, all transactions are performed on line.  At the end of every month simply log on and click one button which commits payroll for the next month.  This action automatically debits a predesignated business account and transfers salaries to all employees of the corporation.  Any bonuses or payroll alterations can be made at anytime.  Simultaneously, tax obligations are sent electronically to state and federal agencies.  A detailed paper report is courier delivered to one’s address of choice which describes and documents all transactions.  At the conclusion of each quarter payroll companies automatically file all California DE9 and DE9C returns, as well as the federal 941.  At the end of the year they provide clients with Form 1040s for all employees. 

The cost to my corporation for all of these services is $41 per month or less than $500 per year.  The price, convenience, and lack of headaches are hard to beat.  Payroll outsourcing is a fool proof way to reduce fixed costs and improve the corporation’s bottom line.

Zhangmu, Tibet - photo by JoAnn Sturman