Payroll is one of the few areas where administrative mistakes can create immediate tax and compliance exposure. The right payroll provider helps you file and pay on time, keeps reporting consistent, and reduces cleanup work for bookkeeping and year-end tax prep.
1) Confirm Tax Filing + Deposit Coverage
Start with the basics: federal and state payroll tax deposits, quarterly filings, and year-end forms (W-2s / 1099s). If any of these are manual, the “cheap” option usually becomes expensive through rework.
- Automated federal + state deposits and filing
- W-2 / 1099 preparation and delivery (including corrections)
- Support for state unemployment and local taxes (where applicable)
2) Ask About Multi-State + Local Tax Complexity
If you have remote staff, clinicians working across state lines, or multiple office locations, confirm the provider can register and handle additional jurisdictions. This is a common failure point when a practice starts growing.
3) Look for Clean Reporting (For Bookkeeping + Tax)
Your payroll system should produce reports that map cleanly to your chart of accounts and let your bookkeeper reconcile payroll consistently. At minimum, you want clear breakouts for:
- Gross wages by employee and by pay period
- Employer taxes
- Employee withholdings
- Benefits and deductions
- Retirement plan contributions (if applicable)
4) Evaluate Integration Fit
If you use accounting software (like QuickBooks Online), time tracking, or scheduling tools, ask how payroll sync works. A real integration should reduce steps, not create double-entry.
- Journal entry sync options (summary vs detail)
- Class/location tracking if you report by office or department
- Time tracking import and approval workflow
5) Understand Pricing (And the Real Cost of “Add-Ons”)
Most providers price with a base fee plus per-employee charges, then add fees for wage garnishments, contractor payments, HR tools, benefits administration, or multi-state filing. Ask for a clear quote based on your current headcount and your expected growth.
6) Onboarding + Support: Who Helps When Something Breaks?
Payroll issues often have deadlines. Confirm whether you get live support, a dedicated specialist, and how amendments are handled if a filing or paycheck needs correction.
- Implementation timeline and data migration support
- Year-to-date payroll history import process
- Process for corrections and amended filings
The Magnolia Perspective
The best payroll provider is the one that keeps compliance automatic and reporting consistent. If your books are clean and payroll filings are timely, you reduce surprises and create a smoother path for tax strategy and year-end planning.