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Written by Devan Adam
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You can get many items free online these days. There are games galore plus downloads for a variety of software programs. When it comes to the payroll software for your business, do you really want a program that’s free?
Paying your employees correctly is a crucial task that must be completed each week. There are also many government forms, which are required by the IRS on a regular basis. A few of the more critical are:
- 941 – Employer’s Quarterly Federal Tax Return
- 944 – Employer’s Annual Federal Tax Return
- 940 – Employer’s Annual Federal Unemployment Tax Return
These must be completed correctly and mailed to the IRS each quarter or annually. These are important documents that are a part of the payroll process. If they aren’t completed correctly and mailed to the IRS by due dates, then your company can suffer. The IRS will charge penalties, which could easily offset the cost of purchasing payroll software for your company.
Many ads, which offer free payroll software, are only free for a certain time limit, such as 90 days or 6 months. Once that free trial period has ended, the company who owns the software will begin charging you. This can be a good way to check out a certain type of software to see if it fits your company’s needs. At some point, however, you will begin paying a monthly fee to use their program or you can purchase the program outright.
There are also companies, which will do your weekly payroll for you. You simply sign up with them and pay a monthly fee and they take care of paying your employing, paying your taxes and filing those IRS forms. Some of the companies will offer their services to you for free for a certain time limit but once that has passed, they will begin charging you. Depending on the size and type of business you run, this can be a great answer to your payroll needs. You might only need one person to work in your payroll department.
Some types of free payroll software will only allow the user access to certain functions. For instance, their free version of the software might allow the user to enter time for employees and print out payroll checks but they may require payment if you choose to use their software when filing forms, such as Form 941, Form 940 or Form 944. Free downloads are available to try out before purchasing the complete version at the free downloads center .
There are some important factors to bear in mind when considering any payroll software, especially a free version. These are:
- Size of your company-if you employ more than 25 people, then the free payroll software would probably not be a good fit for you.
- Deductions – It’s important to determine if the free payroll software can handle all your deductions. Can it handle reimbursements and employee loans, for instance? Is the free payroll software capable of setting limits on deductions? Will it handle end of year resets?
- Filing Taxes – Does the free payroll software allow you to file taxes using stored information from the previous year’s records? Or will there be a fee to do this? Will it handle Earned Income Credits?
- W-2 Forms – This is a critical factor to consider. Will the free payroll software allow you to print out W-2 and 1099 forms to mail to your employees? If not, then it will require extra time and expense to accomplish this crucial task.
- Direct Deposit – Will the free payroll software handle Direct Deposits? Over half of today’s employees request direct deposit, so this is an important factor.
- Earnings – It’s important to determine your company’s earnings categories. Make sure the free payroll software will support all of these categories. If you have complex rules based on things like project pay, make certain that your free payroll software will accommodate this.
- Reports – Does the free payroll software allow you to print out reports of all activities? Printing payroll reports is an important tool in budgeting for your company.
- Security – Make certain that all your financial records will be completely secure. These days, there are unscrupulous people everywhere searching for a weakness in our computers, so that they can break in and steal information.
In the world we live in today, it’s always wonderful to receive something free. But there are certain areas we shouldn’t scrimp on. Often, when we try to save money by purchasing a cheaper version or a free version of something, it winds up costing more in the end.
When it comes to your company’s payroll needs, it is probably best to proceed with caution when considering a free payroll software program. Be sure to ask every question you can think of and be comfortable with the answers before installing the program on your computer or signing any contracts for services. |
