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With ASPs' dependability increasing and outsourcing of all types the hot area for firms, the time has never been better to offer payroll to clients. Firms can even brand online service offerings under their firm's name and basically monitor the interaction between their clients and the payroll companies.
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"Offering payroll is like found money," says Laurence Zuckerman, director of educational services of vendor AccountantsWorld, based in Hauppauge, N.Y., "because you can increase billing from your current clients without having to spend additional money on marketing or hiring firm staff. Training the client to enter payroll data is the most efficient way for the firm to offer highly profitable payroll services. Alternatively, having the clerical staff of the accounting firm enter the payroll data also yields very high realization rates. Fully sourcing the payroll function is also a highly convenient way of earning money from payroll without having to perform, virtually, any work."

"You're helping them with a task that would normally be a headache," says Ken Gaebler, spokesman for SurePayroll (SureChoice), "and you're gaining insights into their business that you might not otherwise have. Use that improved relationship to cross-sell other services, get more referrals, and retain customers."

"Many firms are leveraging the online payroll tools to bring them closer to their clients," says Curt Raffi of Payroll Associates, adding that services to clients can include providing employee self-service tools for benefits, 401(k)s, pre-tax planning, and time and attendance administration; allowing a CPA to aggregate the payroll data from the clients; and data export and reporting capabilities to make management of the GL easier.

Vendors in general are realizing that accountants want to maintain the relationship with the client. Rich Watson, vice president of product management and accounting services for ADP Small Business Services, says, "We realize behavior in the accounting space is highly fragmented, so we try to not change the way the firm does business in offering online payroll, but support the business the firm has set up with the client. This is a way to provide payroll to larger, more profitable clients. Firms also have different relationships when it comes to payroll and clients. But it's always the accountant's payroll support."

Here's what the vendors have to offer:

AccountantsWorld

(Payroll Relief AC)

Costs As low as $5.95 for weekly processing of an employer payroll up to five employees. Each additional employee costs $1 more. Bi-weekly processing is $9.95 per employer for up to five employees.

Features Turnkey system automatically handles check printing, direct deposit, EFTPS, and tax reporting and compliance requirements, including Form 940, 941 and much more. "Full-Sourced" payroll service allows firms to outsource processing to AccountantsWorld (weekly processing of up to five paychecks for a single employer $14.95, plus $1.25 per paycheck for six to 50 paychecks). Firm brochures and additional marketing materials and assistance.

Contact Information AccountantsOffice.com

ADP (EasyPayNet and ADP Payroll for Microsoft SBA)

Costs Based on client size

Features A welcome kit, add on additional products such as time and attendance, retirement services, others.

Contact Information ADP.com

Notes EasyPayNet 5.0 has a simplified design easy to navigate, and users can tailor the process. Adjustable payroll workflow and checklist prompts users with the steps needed to complete a simple payroll in five clicks. Pay input screens can be modified to match user input documents for faster entry. Users can review payroll through on-screen audit reports before processing, among other enhancements.

Creative Solutions (myPay Solutions)

Costs Typically being 30 percent below major service bureau list prices

Features To be used exclusively by CSI software users that are professional accounting firms as an extension of their practice. Paychecks and reports are pushed back to the portal for clients to print. Input such as phone, fax, etc., can be accepted, and hard copy reports/checks can also be created. A separate Accountant portal is available to view clients' reports created by myPay Solutions. Revenue sharing back to the firm, and the firm's payroll is processed for free. The firm also receives complimentary journal entries that can be imported directly into the Thomson Creative Solutions Write-up product. Marketing materials are available to the firms to help promote the service.

Contact Information mypaysolutions.com, (800) 968-8900

Intuit (QuickBooks Online Payroll)

Costs Free license for a small business's accountant. $14.95 per month with no limit on the number of employees.

Features Ongoing free support from set-up to creating paychecks and paying taxes. E-mail customer support and reminders for pay dates and tax filing deadlines. Ability to print signature-ready federal forms such as 940, 941, W2s and W3s, as well as a State Tax Summary report to fill out state forms. Customizable reports also available. Optional Web-based time-tracking feature additional $9.95/month.

Contact Information http://oe.quickbooks.com

PayCycle, Inc.

Costs Accountant Wholesale Program $14.99 per client per month. Price covers five employees, plus 25 cents a month for each employee over five. Supports clients with 50 or fewer active employees.

Features The $14.99 fee covers unlimited payroll runs, free direct deposit, electronic tax payment and filing support for federal taxes (and state where available), W-2's, free quarterly product enhancements, customer support, and customized marketing materials. Also includes a brand-less client Web site to share payroll tasks with clients, and a secure employee Web site where client's employees can log in to view and print their pay stubs. A la carte 1099 e-filing service during the first quarter of every year for $10 per client for up to 50 1099 filings.

Contact Information paycycle.com, (866) 729-2925

Notes Accounting professionals must provide either CPA license number, Enrolled Agent license number, or select that they are a professional accountant or other accounting professional during the sign-up process online and provide proof later.

Payroll Associates (Paychoice)

Costs Referral revenue share up to 25 percent

Features Training and set-up. Turnkey 401(k), online time and attendance, pre-tax plans, and workers' comp products.

Contact Information Paychoice.com

Notes Revenue share can be on a one-time, per-client basis, or on an annual recurring basis over a period of three years.

Sage (Sage Payroll Services)

Costs N/A, training and certification requirements. Accountants must be in full-time public practice with multiple fee-paying clients.

Features Integrates with Sage MAS 90, MAS 200, and Abra HRMS. Direct deposit at no added cost, among other benefits.

Contact Information

accountantsnetwork<at>sage.com, (866) 565-2726

SurePayroll (SureChoice)

Costs Discounted 10 percent from SurePayroll's standard pricing for online payroll service. Pricing based on pay frequency and the number of employees. QuickBooks integration for $3 per pay period. End-of-year W2s and 1099s have incremental fee of $36 plus $3.60 per W2 or 1099.

Features Automatic tax deposits. Clients print checks directly or offer direct deposit. Options to refer the service, resell the service under a firm's brand, or both. Auto deposit of fees to firm. Private label branding. Templated, customizable marketing brochures.

Contact Information surepayroll.com, (877) 954-7873.

BILLING AND MARKETING

Some of these services have low monthly fees and leave plenty of room for profit. One firm using Paycycle, for instance, charges clients a flat monthly fee of $75, and another charges a flat $100 fee. Firms can also charge per payroll, and may charge extra for direct deposit, tax payment and filing support, and other services. SurePayroll has also seen markups by accounting firms handling payroll for clients hit 110 percent over cost. Track your progress, advises Ken Gaebler, spokesman for SurePayroll. "How many clients have signed up? Why haven't other clients signed up? Put a mini-marketing campaign in place for payroll. If you don't spend any time on the initiative, you won't get any results. But in the case of offering payroll, a little effort goes a very long way."

Copyright © 2006. Practical Accountant.