Payroll & HR
Hiring your first employee turns you into a tax collector: you withhold income and payroll taxes, pay the employer share, file quarterly returns, and send W-2s every January. A payroll service handles the calculations, deposits and filings for you, and most also file new-hire reports with your state. For a business with one to ten people, that is usually the single best software purchase after accounting.
This page also collects the federal employer resources owners most often need: E-Verify and Form I-9 for work eligibility, Department of Labor wage rules, OSHA and EEOC small-business pages, and HealthCare.gov for small-group coverage. State rules (minimum wage, paid leave, unemployment insurance) vary, so check your state labor department too.
Payroll services
Hiring & scheduling
Contractors & remote teams
Official employer resources
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HealthCare.gov for Small Business
Small-group health coverage options and the SHOP marketplace.
healthcare.gov
How to choose
- Before choosing payroll, list every state where you have employees. Multi-state support and local tax handling vary a lot between providers.
- Check whether the service files and pays taxes automatically, or only calculates them. Full-service filing is what removes penalty risk.
- Decide employee or contractor carefully. Misclassifying workers is one of the most common and expensive small-business mistakes; the DOL and IRS both publish tests.
- For hourly teams, a scheduling app that exports timesheets into payroll prevents re-typing hours every pay period.
- Keep completed Form I-9s for every employee in a separate file; you must be able to produce them if asked.
Frequently asked questions
When do I need payroll software?
As soon as you have a W-2 employee, including yourself if your corporation or S corporation pays you a salary. Paying only 1099 contractors does not require payroll, though many services offer contractor payments and 1099 filing too.
Is E-Verify required?
Federal law requires Form I-9 for every new hire. E-Verify is voluntary for most private employers but required for some federal contractors and by law in certain states. Check your state rules.
What is the difference between an employee and an independent contractor?
It depends on how much control you have over how, when and where the work is done, and on the economic relationship. The Department of Labor and the IRS each publish guidance; when in doubt, ask an employment attorney.
Can a small business offer health insurance?
Yes. Businesses with fewer than 50 full-time-equivalent employees can buy coverage through the SHOP marketplace or a broker, and some may qualify for a small-business health care tax credit.
Descriptions are written by ShopStart and are not endorsements. Features and prices change; confirm details on each provider's official site. Something missing or out of date? Tell us.