When choosing the best payroll provider in Nashville, Tennessee, it can be hard to know what services to review and consider. Sometimes, it might appear that all payroll services are offering the same thing, but there are a few considerations companies should keep in mind when choosing a payroll provider.

Most payroll service providers provide quality service but there are some who don’t put their clients first. Each year, the IRS sees a few payroll service providers who don’t submit their client’s payroll taxes and closedown abruptly. This leaves the client legally responsible for paying the taxes due, even if they had proactivly sent the funds to the payroll service provider for required deposits or payments. Employers need to understand their payroll and employment tax responsibilities and choose a trusted payroll service. 

Few Considerations for Choosing a Payroll Provider

1. Get a Company that Includes Payroll Taxes

Paying employees is only a small part of what companies need to do when processing payroll. Calculating and filing payroll taxes is one of the most complicated and important HR tasks for any business. Not only are payroll taxes time-consuming, but mistakes can result in hefty fines from the IRS. It makes common sense to outsource payroll taxes when also outsourcing payroll processing. Companies in Nashville should look for an all-inclusive payroll provider with a trusted reputation for filing payroll taxes correctly and on time.

2. Choose a Tech-Savvy Company

Some payroll services operate with antiquated or outdated software and user-friendly web tools. Whichever payroll outsourcing company you choose, make sure it uses up-to-date software that can be easily integrated with your company’s HR systems. Payroll services with better technology also tend to be more aware of the security threats to the sensitive data stored in payroll software. Find a company that takes their technology and security seriously.

3. Find a Service with Time-Saving Tools

A lot of information goes into payroll processing and taxes, but some software programs have made it easier to collect, track, and access that information. Finding a payroll provider that has timekeeping tools, online enrollment tools, and employee self-serve will save your company time and money.

4. Prioritize Customer Service

Good payroll software is extremely important. But, sometimes, you will need or want to talk to an actual person. Be sure that your payroll service provider has a customer support team that’s available to coach you through both your initial transition and answer questions for years to come.

5. Pick a Company that Can Grow with Your Business

The main benefit of outsourcing payroll is freeing up time to grow your business. When that growth does happen, you need a payroll service that can scale up to accommodate additional employees and services. Make sure to find a payroll service with a clear pricing structure. This will help avoid any potential surprises as your service increases.

6. Find a Local Payroll Outsourcing Provider

If you’re a Tennessee-based business, you should find a payroll service that is based in Tennessee. Not only does this allow for in-person collaboration, but local providers are more aware of laws that will directly affect your business. Payroll laws are constantly changing, and local providers are the most aware of changes in the areas in which they are based. For a list of recommended CPEO providers by the IRS, see their CPEO Public Listings on IRS.gov.

7. Consider Outsourcing Other HR Services

Some payroll outsourcing companies also offer other HR services. Professional Employer Organizations (PEOs) can include payroll processing and taxes in a bundle of other HR management services. If you’re already considering outsourcing payroll, it might make sense to outsource other human resources tasks as well.

How do I know I can trust my payroll provider?

The IRS recommended a couple of payroll provider options in a recent Tax Tip to help businesses protect against fraud. There options are as follows:

  • Certified professional employer organization (PEO). In most cases, certified PEOs are liable for paying the customer’s employment taxes, filing returns, and making deposits and payments for the taxes reported related to wages and other compensation. Employers can find these providers on their Public Listings page of IRS.gov.
  • Reporting agent. Reporting agents must deposit a client’s taxes using the Electronic Federal Tax Payment System and can exchange information with the IRS on behalf of a client, such as to resolve an issue. They are also required to provide clients a written statement reminding the employer that it, not the reporting agent, is ultimately responsible for the timely filing of returns and payment of taxes.

To prevent fraud, the IRS encourages employers to enroll in EFTPS and make sure its payroll service provider uses EFTPS to make tax deposits. It’s a free service and it gives employers safe and easy online access to their payment history when deposits are made under their Employer Identification Number, enabling them to monitor whether their payroll service provider is meeting its tax deposit responsibilities.

LBMC Employment Partners, LLC, is Tennessee’s premier payroll service provider, with options for every business size. We were the first Tennessee-based PEO to receive the Certified Professional Employment Organization (CPEO) designation in the first round of IRS certifications. To learn more about our payroll services and/or our PEO services, contact us today.