Intuit’s service offerings in Payroll is incredibly extensive in terms of options, and unfortunately to their detriment, I have found that some people are very confused when it comes to purchasing a payroll add-on through intuit for QuickBooks.
I would like explain in single terms the different options. It is important to note that in 2014 Intuit has done a great job in simplifying the pricing structure.
In a nutshell, there are 3 types of PAYROLL SUBSCRIPTIONS:
- Full Service Payroll. priced at $99/m + $2 per employee/month. Intuit Inc is responsible for filing tax forms 941, 940, w-2, and RT6. Client generates the paychecks online by using the hours or gross pay, the system calculates the withholdings and can either print or direct deposit the paychecks, client can e-pay taxes via the system. This service is 100% web/cloud based.
Alternately, if you are using QuickBooks Desktop, and want the full service from Intuit to file the tax forms while having all the Payroll features inside QuickBooks, you will choose: QuickBooks Assisted Payroll which has a little different pricing scheme, it is $99/month + $2 per employee/per pay-period.
- Enhanced Payroll. priced at $35/m + $2 per employee per month. The user is responsible for paper filing or e-filing the tax forms, which are all automatically prepared by the system (including e-file). Client generates the paychecks by using the hours or gross pay, the system calculates the withholdings and can either print or direct deposit the paychecks, client can e-pay taxes via the system.
- Basic Payroll. priced at $25/m + $2 per employee per month. The user is responsible for paper filing the tax forms. Client generates the paychecks by using the hours or gross pay, the system calculates the withholdings and can either print or direct deposit the paychecks, client pay taxes manually via EFTPS or sends a check to the government (no e-pay available within quickbooks)
Now, these services will have different features depending on whether these are added to QuickBooks Online, QuickBooks Mac, or QuickBooks for Windows (also called QuickBooks Pro, Premier, or Enterprise). So I will explain these depending which version of QuickBooks being used:
- With QuickBooks for Windows (Pro, Premier, or Enterprise): payroll tasks are done within QuickBooks, time sheets can be converted into paychecks (3rd party time tracking systems such as biometric readers, time cards, web-based time-sheets, etc..) can be imported and used to create paychecks; this is particularly important for Job Costing. If you need to job cost (assign payroll expenses including taxes and worker’s comp cost burden) working with the Windows version of QuickBooks with payroll is a must.
1-You may choose QuickBooks Assisted Payroll (priced at $99/month + $2 per employee) because it has all these features, and Intuit will “assist” the user on the tax forms and tax payments, hence the name. In contrast, the same service level using “FULL SERVICE PAYROLL” would keep the user worry-free on the tax forms, but the actual payroll processing is done OUTSIDE of QuickBooks via the cloud, and the job costing capabilities are driven from the imported paychecks, where as the Job costing in QuickBooks Payroll is derived from the time sheet; it is probably not worth getting into the details on how these two contrast, because the end result may be the same… I personally found that Job Costing-heavy companies such as Contractors tend to choose Assisted Payroll instead of Full Service Payroll.
2- If you want to file your own forms and pay taxes electronically via the QuickBooks Product, then the Enhanced payroll is the best option. This can be done from within in-product to retain all the job costing capabilities. The counterpart to this product is called Intuit Enhanced Payroll at the same price level, but web-based; again we have the same limitations with job costing
3 – And finally, if you need all the job costing tools, but have a 3rd party accountant taking care of your payroll compliance (or even doing it yourself manually) then the QuickBooks Basic Payroll is the best choice. Again the counterpart to this product is Intuit Basic Payroll at the same price point, but again, based on the cloud and with limited job-costing.
- With QuickBooks Mac, or even if you have No QuickBooks at all, then the payroll options are 100% web based with the same product described above:
1 – Intuit Full Service Payroll
2 – Intuit Enhanced Online Payroll
3 – Intuit Basic Payroll
- With QuickBooks Online, the service is a bit different. If you have QuickBooks Online and need payroll, you should consider using the built-in Payroll feature within QuickBooks Online or Intuit Full Service Payroll. If you use the Payroll feature within QuickBooks Online, you can create paychecks, and e-file and e-pay payroll taxes all within a single system.. With Intuit Full Service Payroll, you enter the hours online (in a separate system outside of QuickBooks Online) and Intuit processes the payroll and files and pays the taxes for you. As you consider different options, you should think about how involved you want to be in managing payroll and this can help you determine the right payroll solution for you and your business.
Please visit Intuit’s Product Comparison Guide. Also keep in mind the pricing above is based on their standard prices, at times you may see discounts such as 20% off the first year or so… as introductory offers, but I cannot put them in this blog, because I would have to update it weekly, Call us for the latest pricing, or if you need guidance choosing the best option for you.
Also, if you are an accountant, you will like to read these articles about Payroll for Accountants: