💳 How to Set Up Payroll for a Small Business
Run your first compliant payroll without expensive mistakes.
💰
Software plans $30-$100 monthly typical; penalties loom for late deposits
⏱️
Setup completed within days once accounts established
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📋 Documents you'll need
- Federal EIN obtained earlier
- State withholding unemployment accounts
- Employee W4s I9s banked details
- Payroll service selection finalized
- Deposit frequency determination letters
🪜 Step-by-step
- Register for federal EIN if not yet assigned since IRS tracks employers through identifiers.
- Open state income tax withholding plus SUTA accounts whenever staff work within those borders respectively.
- Collect Form W-4s direct deposit authorizations I-9 verifications completing personnel files comprehensively upfront.
- Choose frequency (weekly biweekly semimonthly) staying consistent thereafter since switching requires notifications.
- Select service providers automating calculations filings deposits versus managing manually demanding strict calendar adherence throughout.
| Estimated cost | Software plans $30-$100 monthly typical; penalties loom for late deposits |
|---|---|
| Typical timeline | Setup completed within days once accounts established |
Note This guide is general information and procedures, fees, and rules can change and vary by state or agency. The official authority is always the relevant government office and its official website. See our Disclaimer.
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Frequently asked questions
Deposits how quickly after pays?
Semi-weekly or monthly schedules apply depending size rules - newly covered businesses default monthly mostly.
Contractors skip payroll entirely?
True independent contractors receiving 1099s avoid W2 machinery though misclassification audits sting badly when miscategorized.
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