Independent contractors, also known as 1099 employees, have unique payroll needs that require specialized software. These workers are not considered traditional employees and are responsible for their taxes and other financial obligations. Independent contractor payroll software is designed to help manage these requirements and ensure compliance with state and federal regulations. In this article, we will discuss the 7 best payroll independent contractor software options.
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7 Best Payroll Software for Independent Contractors
1. Gusto
Gusto is a payroll software designed specifically for small businesses, including independent contractors. It offers a range of features to help independent contractors manage their payroll. It includes automatic tax calculations, direct deposit, and employee self-onboarding. One of the key benefits of Gusto is its user-friendly interface. Which makes it easy for independent contractors to manage their payroll without needing a lot of technical expertise. Other benefits include its ability to handle multiple state and local taxes, as well as its ability to integrate with popular accounting software.
2. Quickbooks
QuickBooks is a well-known accounting software that also includes payroll functionality. This makes it a convenient option for independent contractors who need to manage both their finances and employee payments. The payroll features in QuickBooks include the ability to handle multiple state and local taxes, direct deposit, and employee self-onboarding. It also allows you to track and pay 1099 employees which is beneficial for independent contractor payroll software.
3. Wave
Wave is a free payroll software designed for small businesses, including independent contractors. It offers a range of features to help independent contractors manage their payroll. It includes automatic tax calculations, direct deposit, and employee self-onboarding. One of the key benefits of Wave is its cost – it’s free to use, making it a great option for independent contractors who need to manage payroll on a tight budget.
4. Zenpayroll
ZenPayroll is a cloud-based payroll software designed for small businesses, including independent contractors. It offers a user-friendly interface and a range of features to help independent contractors manage their payroll. It includes automatic tax calculations, direct deposit, and employee self-onboarding. One of the key benefits of ZenPayroll is its ability to handle multiple state and local taxes. It can integrate with popular accounting software such as QuickBooks.
5. Patriot Software
Patriot Software is another payroll software designed for small businesses, including independent contractors. It offers a range of features to help independent contractors manage their payroll, including direct deposit, automated tax filings, and employee self-onboarding. One of the key benefits of Patriot Software is its ability to handle multiple state and local taxes, as well as its ability to integrate with popular accounting software such as QuickBooks.
6. Adp
ADP is a well-known payroll provider that offers a range of payroll solutions, including options for independent contractors. Some of the features of ADP include direct deposit, automated tax filings, and employee self-onboarding. One of the key benefits of ADP is its ability to handle multiple state and local taxes. Additionally, ADP offers an array of services, including human resources and benefits administration, which can be beneficial for independent contractor software.
7. Paychex
Paychex is another payroll provider that offers a range of payroll solutions, including options for independent contractors. Some of the features of Paychex include direct deposit, automated tax filings, and employee self-onboarding. One of the key benefits of Paychex is its ability to handle multiple state and local taxes. Additionally, Paychex offers an array of services, including human resources and benefits administration, which can be beneficial for independent contractor software.
All the above-mentioned payroll software for independent contractors is designed to help independent contractors and small business owners manage their payroll efficiently. They offer features such as automatic tax calculations, direct deposit, employee self-onboarding, and the ability to handle multiple state and local taxes.
These tools are also known as 1099 payroll software as they are capable of handling and tracking 1099 employees. With the help of these tools, independent contractors can easily manage the payroll of their 1099 employees.
Benefits Of Using Payroll Software
Automated Tax Calculations: Payroll software for independent contractors can automatically calculate and withhold the appropriate taxes for each employee, reducing the risk of errors and saving time for the business owner.
Direct Deposit
Most payroll software for independent contractors offers the option of direct deposit, which allows employees to receive their paychecks directly into their bank accounts. This can save time and money for both the business owner and the employees.
Employee Self-Onboarding
Some 1099 payroll software includes employee self-onboarding features, which allow employees to enter their own personal and tax information into the system. This can save time for the business owner and also ensure that the employee’s information is accurate and up-to-date.
Multiple State And Local Taxes
Many payroll software for independent contractors can handle multiple state and local taxes, which can be a major benefit for businesses that operate in multiple states or have employees who live in different states.
Integration With Accounting Software
Some payroll software for 1099 employees can integrate with popular accounting software, such as QuickBooks, which can make it easier to manage both payroll and finances in one place.
Record Keeping
Payroll independent contractor software can help keep accurate records of all the payments and taxes that the government requires, this can save a lot of time and effort while preparing tax returns.
Time-Saving
By using the software for independent contractors, business owners can save a lot of time as the software automates many of the tasks involved in payroll processing, such as calculating taxes and making direct deposits.
Cost-Effective
Payroll software for independent contractors can be cost-effective, especially when compared to the cost of hiring a dedicated payroll professional. Additionally, using it can reduce the risk of errors and penalties, which can save money in the long run.
Handling 1099 Employees
As mentioned earlier, the software can handle and track 1099 employees, which is a big advantage for independent contractors and small business owners who have 1099 employees.
Reports And Analysis
Many payroll software for independent contractors offer reports and analysis features, which can help business owners better understand the payroll and make informed decisions.
Overall, using the software for independent contractors can save time and money for business owners, while also reducing the risk of errors and penalties. It can also offer additional benefits such as employee self-onboarding and integration with accounting software, making it a valuable tool for independent contractors and small business owners.
Conclusion
Payroll software for an independent contractor is essential for managing the unique financial needs of 1099 employees. The software can automate tax calculations and filing. It also provides detailed reports and analytics to help independent contractors manage their finances effectively.
