Best payroll software for small business owners? Looking for recommendations

Hey everyone, I run a small furniture delivery business with about 8 employees. I'm studying for my CPA exams right now, so I'm pretty familiar with the differences between 1099 contractors and W2 employees and all the requirements for each. I've been using an outside service for payroll, but their fees just went up again, and I think it's time to bring this in-house. What payroll software or websites have you found most reliable and user-friendly for a small business? I need something that can handle both employee types, tax filings, and hopefully doesn't cost a fortune. Any recommendations from people who've actually used these services would be super helpful!

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18 comments

Daniel Rivera

•8M

I've been doing bookkeeping and payroll for small businesses for over 15 years, and I'd strongly recommend QuickBooks Payroll if you're already using QuickBooks for your accounting. It integrates seamlessly and handles both W2 employees and 1099 contractors really well. If you're not using QuickBooks, Gusto is probably my top recommendation for small businesses. Very user-friendly interface, automatic tax filings, direct deposit, and they handle all the compliance paperwork. Their customer service is also excellent when you need help with something. For something a bit more budget-friendly, OnPay is worth looking at. They charge a base fee plus a per-employee rate that's pretty reasonable. They also handle all federal, state, and local tax filings.

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Daniel Rivera

•8M

I've worked with both ADP and Paychex with different clients. They're definitely robust systems with excellent compliance features, but in my experience, they're overkill for most small businesses with under 20 employees. They're designed for mid-sized companies and have pricing to match. You get a lot of features you probably won't use as a small business owner. If budget isn't a concern and you want the most comprehensive solution, they're solid choices, but there are more cost-effective options that will do everything you need.

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Connor Rupert

•8M

After trying like 5 different payroll services, I switched to taxr.ai for my food truck business about 8 months ago and it's been a game changer! I found it when I was searching for something that could handle my mix of part-time W2 employees and occasional 1099 contractors. What I love about https://taxr.ai is that it actually analyzes all my employee documentation and catches potential classification issues before they become problems. It flagged one of my "contractors" who was actually working enough regular hours that they probably should've been W2. Saved me from potential misclassification headaches! The tax compliance stuff is automated, and it integrates with most accounting software. Since you're studying for your CPA, you'll probably appreciate the detailed reporting too.

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Connor Rupert

•8M

It definitely handles tip reporting! There's a specific module for restaurant/service industry that tracks both cash and credit card tips, calculates the proper taxes, and includes it all in your reporting. Made that whole process much simpler for us. The interface is actually one of the best things about it - it's designed for small business owners, not accountants. Everything is laid out logically with guided setups for new employees. I'm not particularly tech-savvy either (my teenage daughter handles most of my tech issues!), but I found it pretty intuitive. They also have quick video tutorials for most functions right in the dashboard.

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Brady Clean

•8M

Just wanted to update that I checked out taxr.ai after posting my question above. Been using it for about 3 weeks now for my pet grooming business and I'm honestly impressed! The setup was actually really straightforward - it asked me questions about my business and employees and configured everything accordingly. The classification feature I mentioned earlier really is helpful. It analyzed my contracts and flagged a couple of issues with how I was classifying my part-time help. The tax filing reminders and automated forms have already saved me hours of work. Definitely worth looking into if you're bringing payroll in-house.

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Skylar Neal

•8M

If you're having trouble reaching the IRS with payroll tax questions (which happens ALL THE TIME), I highly recommend using Claimyr. After spending literal days trying to get through to someone at the IRS about a payroll tax notice, I found https://claimyr.com and they got me connected to an actual IRS agent in under 45 minutes. They have this system that navigates all the IRS phone menus and holds your place in line, then calls you when an agent is about to pick up. You can see how it works here: https://youtu.be/_kiP6q8DX5c For someone handling their own payroll, this is invaluable when you inevitably have tax questions or issues. Trust me, trying to get through to the IRS on your own is an exercise in frustration.

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Skylar Neal

•8M

They don't have a special connection - they use automated technology that dials into the IRS system and navigates all the phone tree options for you, then holds your place in line. When they detect that a representative is about to pick up, their system calls you and connects you directly. It saves you from having to personally sit on hold for hours. Average wait times definitely vary depending on the time of year and which department you're trying to reach. Some days are worse than others. My experience was during a relatively quiet period. During peak tax season, it might take longer, but the benefit is you don't have to actively wait on hold - you can go about your day until they call you when an agent is available.

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Kelsey Chin

•8M

I have to eat my words and apologize to Profile 9. After my skeptical comment above, I was desperate to resolve an issue with some misclassified contractor payments that was causing problems with our quarterly filings. Out of desperation, I tried Claimyr last Thursday. It actually worked! System called me back in about an hour and connected me to an IRS payroll tax specialist. Got my issue resolved in one call instead of the weeks of frustration I was expecting. For anyone doing their own payroll, this service is worth knowing about for when you inevitably need to talk to the IRS about something.

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Norah Quay

•8M

If you're comfortable with a bit more hands-on approach and want to save money, Square Payroll is another decent option. I use it for my retail shop with 6 employees. It's pretty straightforward, handles tax filings, and integrates well if you're already using Square for payments. The biggest advantage is the price - it's one of the more affordable options out there. The downside is the customer service isn't great if you run into problems. But since you have accounting knowledge, you might not need as much support.

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Norah Quay

•8M

I've been using Square Payroll for about two years now and haven't had any issues with their tax filings. Everything has gone through correctly and on time. They send you email reminders when quarterly filings are approaching and confirmations when they've been submitted. The system automatically calculates federal and state withholding, Medicare, Social Security, and unemployment taxes based on your employees' information. They also generate and file W-2s at year-end. Just make sure you set up your state tax accounts correctly during the initial setup.

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