Payroll Articles
Deciding Between Outsourcing and In-House Payroll?
By: Sandi Smith, CPA
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If you can't stand to compromise, this article's for you. Do you want both peanut butter and chocolate? I give you Reese's Peanut Butter Cups. Need a beer that's less filling and tastes great? Welcome to Miller Lite. How about a payroll solution with the benefits and conveniences of having clients control payroll in house but not have to touch their payroll taxes and government filings with a 10-foot pole? Meet Intuit's QuickBooks® Assisted Payroll.
Let's get down to business and examine what accountants are saying about this hybrid option that combines the advantages and eliminates the disadvantages of outsourcing payroll.
In with Payroll Journal Entries and Checks
Duplicate data entry is eliminated when payroll is done in house instead of outsourced. Denise Duplinski, CPA and partner of Long and Duplinski CPAS in Dayton, Ohio, explains this benefit perfectly: "I like my clients to use the Assisted Payroll instead of the outsourced solution for the simple reason that you only have to do payroll once with Assisted Payroll. If you use an outsourced solution, you have to create payroll in that outsourced solution, then re-enter (in some fashion) the same information in QuickBooks to record the payroll. Also, for construction clients, it is extremely time consuming to do the job costing necessary for a complete bookkeeping system without doing payroll via Intuit QuickBooks Assisted Payroll."
"The best part is that all payroll journal entries are downloaded automatically into my clients' QuickBooks file," says Duane Haaland, Enrolled Agent and President of Pacific Financial Incentives, Inc. [web link: http://www.pfitax.com] of San Rafael, Calif. "The result is a fully integrated process that provides detailed payroll reports for each employee. Another benefit is the timekeeping process that is fully integrated with payroll and accounts receivable. For clients who use the time sheet in QuickBooks, the entire process of timekeeping and collating the same information for the client billing process is covered by entering the data only once. The data can then be used to produce payroll and create client invoices," explains Duane.
"It just makes the bank reconciliation so much easier when clients take the option of having the paychecks cut on the Intuit account," says David Enix, President and CEO of Enix & Associates, LLC of Tavares, Florida. "For my larger clients using QuickBooks Enterprise that have weekly payroll, the cost savings on the bank reconciliation process alone pays for the weekly processing fee," adds David Enix, an Advanced Certified ProAdvisor, and by the way, a brand-spanking new dad of a 2-day-old baby girl, Kayla Nicole, as of this writing.
Out with Taxes and Support
While keeping payroll checks and journal entries in house is a benefit, the opposite is true for taxes and support.
The primary reason David Enix prefers Assisted Payroll is because Intuit assists in handling the financial transfers for paying the payroll taxes and prepares and files all quarterly and annual reports. "I tell my clients this is the best insurance policy they can have because of the potential liability if the payroll taxes are not deposited correctly and on time."
Denise, an Advanced Certified QuickBooks ProAdvisor and a member of the Intuit Retail Solution Provider Program, adds, "A small business owner has enough to do without worrying about payroll tax issues. Missing one payroll tax deadline can cost more than the fees that Intuit charges for payroll services," says Denise.
"Also, the phone support included at no extra charge is invaluable," adds David Enix.
Aaron Tickner of AaccountAbility in New Kensington, Penn., shares his experience with Intuit's phone support. "I have many examples of tax notices generated in error and Intuit's tax team handling them successfully. The ability to pass these types of issues on to Intuit is a big benefit of the service in itself, because the agencies involved are usually slow to respond and their records are often inaccurate."
Digital Icing on the Cake
An optional feature of QuickBooks Assisted Payroll is direct deposit. "I've advised my clients that it makes a good deal of sense to use this feature, as it cuts down on lost checks and reconciliations and avoids paper, stamps, and even the physical presence of passing out a check," reports David Kiley, a CPA and partner of Capo, Kiley & Associates, PC of Newburyport, Mass. "What sets it apart from other direct deposit services is that the process is fast. There's no special fax number to send a voided check, nor a two-week wait time to have the EFT approved. All for $1 to boot."
Price Tag
Adriana Perry of A&J Accounting, Inc. of Brooklyn, New York, has the last word about what clients like best about Assisted Payroll, which can be half the cost of some of the major payroll processing services: "PRICE!"
If you hate to compromise, check out QuickBooks Assisted Payroll for yourself.
Sandi Smith, CPA, is a freelance writer and professional speaker located in Dallas, Texas. She is a frequent contributor to Intuit® ProConnection®. Her web site is http://www.sandismith.com.
Last Updated: 02/07/2008
