Nationwide Payroll Processing

Posted Thursday, January 26, 2023

Ugh! Every business owner hates payroll. Hates running it. Hates paying to run it. Hates licking stamps. Yet, here we are.

WCG offers payroll services in a variety of forms and function, and we tailor a system that is custom to your needs. Anyone can set up the withholding accounts and run payroll- a quick warning however. If you think the IRS is crazy about income taxes, they are insanely fanatical about timely and proper payroll taxes. Fines and penalties can jump up right quick if payroll is messed up. And, payroll never sleeps!

ADP and Paychex are leaders in payroll processing and can offer a ton of benefits to you vis-à-vis WCG. Benefits include-

1. Electronic Payments– Direct deposit is a nice way to streamline your payroll processing. Prevents lost checks and other nonsense.

2. Fraud Protection– Paper paychecks lend themselves to fraud. Hi tech photocopiers or sophisticated computer users who purchased VersaCheck check writing software for example can emulate your check easily. And remember, payroll checks can be cashed at any grocery or convenience store, or even a Wal-Mart. Those employees simply are not trained well enough to spot bogus checks. With ADP and Paychex, we can set up incognito accounts so your banking information is never seen by your staff. Pro-tip: make all employees use direct deposit.

3. Unlimited HR Help Desk– Affordable Care Act, or Obamacare, is continuously evolving. Currently we are contending with Employee Retention Credits and other COVID tax credits. For some employers, the need to maintain accurate records on timecards is huge. And even if you have fewer than 50 full time equivalents (FTE), there are still notices and hoops you might have to jump through to be in compliance. Through WCG, you have unlimited access to ADP’s human resources help desk. Question on overtime? Got it! Question on termination? Got it!

4. Access– Need extra copies of W-2s? Want to know the history of pay for a certain employee? We set you up with all the access you need to your payroll data.

5. Chores- Payroll is a chore. Let someone else do it! Just because you can doesn’t mean you must. As a business owner you want to get away from time to time, and who wants to run payroll from their phone or tablet? Yuck. Nothing like getting trapped without internet service, and your employees go unpaid.

Payroll is a commodity and as such we don’t make any profit on it… we offer it as a convenience to our business owners. As such we only process payroll if you also have a Business Advisory Service plan with us (see our fee page for more information on our business advisory plans). Here is some quick pricing for your review-

* assumes direct client entry into payroll system, with verification and final approval by WCG. WCG to onboard and terminate employees as necessary.

All our payroll fees include ADP or Paychex fees, and are based on the assumption of 1 state and direct deposit. We have clients with 2 employees and we have clients with over 100 employees spanning multiple states. We got you covered!

After the initial payroll setup is complete, there will be a $50 onboarding fee for each new employee which will be automatically invoiced and paid with the payment information on file.

The fees paid to us include the payroll processing fees charged by ADP or Paychex. In other words, you are not charged separately by ADP or Paychex for normal payroll processing. However, if payroll tax filing amendments are required for reasons that are not WCG error, separate fees will be charged. For example, you inform us to deduct 401k contributions from your paycheck, but later want to unravel this because of a change in cash flow or investment strategy. Payroll tax filing amendment can easily exceed $500 per quarter since there are several forms (federal, state and local) that need to be corrected.

Payroll funds are required to be in your business checking account 5 days prior to the check date. Typical shareholder-only payroll is processed on the 10th of the month requiring funds to be available on the 6th of the month. We will advise you of the cash needs amount for payroll processing during onboarding, tax planning and routine internal payroll audits. We will notify you twice via email and text messages of changes to your cash needs; please be sure to respond with any problems or concerns.

Payroll Funds
Payroll funds are required to be in your business checking account 5 days prior to the check date. Typical shareholder-only payroll is processed on the 10th of the month requiring funds to be available on the 6th of the month. We will advise you of the cash needs amount for payroll processing during onboarding, tax planning and routine internal payroll audits. We will notify you twice via email and text messages of changes to your cash needs; please be sure to respond with any problems or concerns.

Data From You
Should you need to update hours or pay rates, or other adjustments to payroll, these must be received by our payroll team by 11:0AM two business days prior to the pay date. For example, a Friday pay date would require all changes and related payroll information to be submitted to us by 11:00AM on Wednesday. Everyone has emergencies, we understand, but there are no exceptions to this cutoff. Payroll will simply process the next day, and in this example, on Monday.

Minimum Payroll
At times you might need to process minimum payrolls. This is common for seasonal businesses such as realtors, or other businesses where income is lumpy or bumpy. We cannot skip payroll since some states will close your payroll accounts which creates a large mess. As such, the minimum salary is $500 per month which requires about $100 in cash needs (we do some magic with payroll advances to “zero out” the net check to reduce cash needs).

At some point, however, we need to re‐evaluate payroll needs and make adjustments in Q4. Also, the beauty of payroll processing and leveraging it to pay income taxes similar to estimated tax payments is that the IRS and the state assume salary and income taxes were paid evenly throughout the year regardless of when payroll was actually processed and the amounts. Yay! Having said that, we prefer to have routine and even salary amounts each month if possible.

We have created a verbose payroll welcome kit with all kinds of issues that you need to be aware of (for example, employee 401k contributions) plus examples of payroll reports (and how to read them for journaling into your accounting system). This is a must-read for all business owners-

There are three ways to deliver payroll to your employees-

1. Paystubs– we create paystubs, and you simply write checks from the business checking account. There is a significant additional fee for this since it is messy and involves a lot of communication.

2. Paper Checks– ADP or Paychex writes checks and overnights them to you.

3. Direct Deposit– ADP or Payche drafts the full amount of cash for net checks, withholdings and payroll taxes the day prior. This is our preference.

Regardless of which method you use above (1-3), payroll filings and deposits are done automagically. If you do your own bookkeeping, we can also provide the journal entries for your cash, expense and payroll liability accounts. As mentioned we can customize a payroll system that works best for you.

We use ADP and Paychewx  for our payroll processing, however your first and last call for help is WCG. We also do the data entry for your payroll needs- store managers can call in payroll hours, you can email us a list, create a spreadsheet, send notes by carrier pigeon, whatever works for you. Again, we process your payroll, and use ADP or Paychex as our engine and compliance partner.

Of course if you feel the need to make your own payroll entries, we can show you how that is done- you always have login credentials to your account, and can also reprint W-2s or paystubs. But we would maintain access to your account with our credentials to fix problems, or to be your backup when you go on vacation or are sick. As mentioned earlier, payroll never sleeps.

Payroll is not just about writing paychecks. You might also have deductions such as health insurance, garnishments, child support, 401k, IRA and other deductions (or reimbursements) that need to be dealt with outside of the payroll run. Of course we maintain all this information for you, and can either have ADP write checks directly (using the Cadillac version) or we can tell you what to pay and where to send it.

S Corps are required to pay their shareholders a reasonable salary. What is a reasonable salary and how often to pay a salary are questions that are answered in our KB articles on S Corps. Please see more information here-

If you are new to payroll, we can set up your withholding, unemployment and state disability accounts for $300 to $450 depending on the state. We have worked with most states and can quickly get things moving along for you. Conversions from an in-house payroll system are slightly easier, but still require considerable time inputting all the YTD data and employee information.

Like a marriage, payroll is easy to get into and hard to get out of. Please understand that payroll is typically a year-long commitment. There are quarterly filings and annual filings. And if a single quarterly filing is prepared and submitted, that automatically triggers a requirement for annual (year-end) filings to be prepared and submitted. If you decide to stop payroll services or switch to another provider, we will assist in that transition. However, you might still incur service fees associated with payroll since a mid-period cancellation will require payroll forms to be prepared and filed, or at least transitioned to another provider.

WCG (formerly Watson CPA Group) are tax and business consultants, not just number crunchers. Anyone can balance a checkbook. Anyone can write a check and hand it to an employee. But we take a consultative approach to your small business. Please consider the solid payroll services and consultation support which you will get with WCG (formerly Watson CPA Group) that other bookkeeping companies might not provide. Remember, we are accountants and payroll specialists. Read more about our Value Proposition here.

Let us do the payroll! Seems easy, but do you really want to be bothered with this recurring task?