Save Your Clients Time and Money with Office Accounting Payroll

By David H. Ringstrom, CPA

Everyone likes to get paid, but hardly anyone likes to process payroll. No problem: payroll in Office Accounting requires only four clicks. Further, it’s powered by ADP and it costs less than payroll services that QuickBooks or Peachtree offer. Plus your clients can process payroll on their own, send their books to you to handle payroll or outsource much of their payday to ADP. Read on to see how Office Accounting and Payroll by ADP can transform payday for you and your clients.

Try it now: Run a sample payroll using the ADP Payroll Demonstration or sign up for a free 30-day trial. Office Accounting Express is a free download, while Office Accounting Professional costs $149.

Three Tiers of Service

Office Accounting Payroll Powered by ADP offers three levels of service:

·         Payroll Standard ($169/year) – This service level suits to clients who wish to process payroll either in-house or via their accountant and includes:

ü  Federal, state, and local tax calculations;

ü  Payroll check or voucher printing;

ü  Weekly, semi-monthly, or monthly pay frequencies;

ü  Track paid time off, such as sick, personal, and vacation;

ü  Ability to easily reprint or renumber checks (in the event of printer errors);

ü  Direct deposit for employees;

ü  Workers compensation tracking; and

ü  Signature-ready tax forms, including payroll tax returns and W-2 forms.

Value-added: Unlike QuickBooks and Peachtree, this service includes direct deposit at no extra cost, and it can divide employees’ paychecks between two bank accounts if they wish.

·         Payroll Standard plus eFiling ($229/year)  – This service level — for in-house or accountant processing — includes:

ü  All of the above benefits of Payroll Standard; and

ü  Electronic payment and filing for payroll taxes and returns.

Savings abound: Spend an extra $5 per month to save much more. Electronic filing eliminates trips to the post office and the cost of certified mailings.

·         Total Payroll (starts at $27 per processing) – This service level, geared for clients that prefer to have ADP perform as much of the payroll function as possible, includes:

ü  All of the above benefits of Payroll Standard plus eFiling;

ü  ADP files and pays taxes on your behalf;

ü  A 100% no-penalty guarantee; and

ü  ADP experts help your clients set up payroll!

Hands off: Total Payroll serves as an excellent alternative if you don’t offer payroll services to your clients. However, read Increase Your Billings by Handling Tasks Your Clients Hate and Collaborate Electronically with Your Clients with Microsoft Office Accounting 2007 before you rule out this revenue opportunity.

Easy Sign-Up Process

Your clients can sign up for payroll in Office Accounting by using any of these methods:

·         Choose Employees, Online Payroll, and then Sign Up for Payroll Service;

·         Click the Payroll icon in center of the Employee Center screen;

·         Click the Sign Up for ADP Payroll link in the Spotlight section of many centers; or

·         Call 866-385-2017.

Prep work: ADP offers a helpful payroll checklist that your clients can use to gather all the information they’ll need to use payroll in Office Accounting.

Streamlined Interface

As shown in Figure 1, Office Accounting groups payroll functions into six tabs:

1.      Payroll – Run payroll, print checks or vouchers, process direct deposit, download to your general ledger, or record special entries from this tab.

2.      Payroll Reports – As I’ll discuss in a moment, Office Accounting offers a dozen payroll- and benefit-related reports.

3.      Taxes – This tab provides an overview of taxes incurred by your employees or company and quick access to previous returns.

Figure 1: Office Accounting offers an easy-to-use payroll interface.

Smart: Employees can use an online withholding calculator offered by the Internal Revenue Service to minimize their annual tax refunds and maximize their paychecks.

4. Employees – This tab makes it easy to edit or maintain employee records.

Privacy assured: The employees tab reveals compensation information only after you drill down into an individual employee record.

5. Company – This tab allows you to manage your company information and payroll preferences.

6. Support – This tab allows your clients to manage passwords, user security, and gain assistance from ADP.

No maintenance: ADP payroll updates itself automatically, unlike QuickBooks or Peachtree Accounting, which require periodic downloads to keep tax tables current.

Process Payroll in 4 Clicks

At the start of this article, I promised that a pay run requires only four clicks:

1.      Choose the payroll run in the Today’s Payroll tasks of the Payroll Home screen, shown in Figure 1.

2.      Click Next on the Run Payroll screen after you confirm that hours and earnings automatically prefilled on the screen correctly, as shown in Figure 2.

Figure 2: You can accept or override default pay values on the Run Payroll screen.

3.      Click Next on the Preview Payroll screen after you review gross and net pay, along with employee and employer taxes and deductions, as shown in Figure 3.

Figure 3: The Payroll Preview screen provides an overview of the current pay run.

4.      Click Finish on the Process Payroll screen, as shown in Figure 4.

Figure 4: Finalize the pay run on the Process Payroll screen.

View Payroll Reports and Tax Returns

Office Accounting provides a dozen reports grouped into four categories that keep compensation, tax, and benefits history at your fingertips:

·         Payroll Reports

ü  Payroll Summary: As shown in Figure 5, this report lists paycheck totals by employee, including total wages, taxes and deductions, and employer liabilities.

Figure 5: The Payroll Summary provides an overview by employee.

ü  Payroll Details: This expanded version of the employee summary breaks out employee-pay activity by paycheck range, and details earnings, taxes by type, as well as deductions and employer liabilities.

ü  Earnings Record: This report provides an overview of all information appearing on an employee’s pay statement for a selected period as well as year-to-date.

ü  Payroll Liability: As you would expect, this report details total payroll-tax liabilities for the pay period range of your choice.

·         Benefit Reports

ü  Deduction Summary: This report lists deduction amounts by employee and deduction type. You can view all deductions at once or select a specific type, such as 401(k).

ü  Employee Paid Time Off: This report answers the perennial question “How much vacation time have I taken?” by listing allowed and taken hours, along with balances available for sick, personal, and vacation time, if applicable.

ü  Workers' Compensation: This report helps simplify workers’ compensation premium filings by listing employees and earnings by class and state.

·         Tax Reports

ü  Wage and Tax Register: This report details every aspect of an employee’s earnings, exemptions, taxes, and deductions.

ü  Quarterly Local Tax Withholding: This report delves into local withholdings, and can be run on a jurisdiction-specific basis.

ü  Quarterly Local Tax Reconciliation: This report aids in filing local withholding returns by summarizing the number of resident and non-resident employees, as well as taxable and non-taxable local wages.

·         Miscellaneous Reports

ü  Employee Summary: This report provides an overview of each employee’s earnings, taxes, and deductions, as well as year-to-date totals and direct deposit status.

ü  W-2 Preview: This report provides a box-by-box summary of all information that will appear on each employee’s annual W-2 form.

Comprehensive Earnings and Deductions Categories

Office Accounting tracks just about every type of compensation, benefit, and withholding. These built-in categories make tracking even complex payroll arrangements a breeze:

·         Standard Earnings

ü  Regular

ü  Overtime

ü  Bonus

ü  Miscellaneous Pay

ü  Commission

ü  Double-Time

ü  Retroactive Pay

ü  Advance – Taxable

ü  Severance

·         Paid Time Off

ü  Vacation

ü  Sick

ü  Personal

ü  Holiday

ü  Bereavement

ü  Jury Duty

ü  Training

·         Fringe Benefits

ü  Automobile Fringe

ü  Group Term Life Insurance

ü  Misc. Fringe Benefit

ü  S-Corp 2% Medical Plan

ü  Stock Options – Non-Qualified

·         Reimbursed Expenses

ü  Misc. Reimbursement Non-Taxed

ü  Expense Reimbursement Non-Taxed

ü  Mileage Reimbursement Non-Taxed

ü  Business Expense – Unsubstantiated

ü  Moving Expense – Non-Qualified

ü  Tuition Reimbursement – Non-Taxed

ü  Business Expense – Substantiated

·         Miscellaneous Deductions

ü  Garnishment (percentage or dollar amount)

ü  Child support (percentage or dollar amount)

ü  401(k) loan

ü  Charity

ü  Uniform

ü  Union

ü  Credit union

ü  Christmas club

ü  Vacation club

ü  529 savings plan

ü  Transit pass pre-tax

·         Post-Tax Insurances

ü  Medical 1 and Medical 2

ü  Dental

ü  Life insurance

ü  Vision

ü  Long-term disability

ü  Dependent care

ü  Accidental death & dismemberment

ü  HSA Post-Tax (percentage or dollar amount)

ü  HSA Post-Tax Catch-Up (percentage or dollar amount)

·         Pre-Tax Insurances

ü  Medical 1 and Medical 2

ü  Dental

ü  Life insurance

ü  Vision

ü  Long-term disability

ü  Dependent care

ü  Accidental death & dismemberment

ü  HSA CAF125 (percentage or dollar amount)

ü  HSA Employer Pre-Tax Contribution (percentage or dollar amount)

·         Retirement

ü  401(k) plan (dollar amount only)

ü  401(k) catchup (percentage or dollar amount)

ü  Simple 401(k) (percentage or dollar amount)

ü  Simple 401(k) catch-up (percentage or dollar amount)

ü  Simple 401(k) Non-elective contribution

ü  Simple IRA (percentage or dollar amount)

ü  Simple IRA catchup (percentage or dollar amount)

ü  403(b) plan (percentage or dollar amount)

ü  403(b) plan catch-up (percentage or dollar amount)

ü  408(k) SAR SEP (percentage or dollar amount)

ü  IRA post-tax

The views and opinions expressed in this column are those of the author and do not necessarily reflect the opinions of Microsoft.