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Peachtree PayrollIf you've been manually figuring employee paychecks, then you'll love Peachtree payroll. In fact, if your business has any employees at all, then I'd recommend that you either run your payroll using Peachtree or use an outside payroll service. Even if you only have one or two employees, you don't want to spend your time hand calculating paychecks and manually managing payroll. Using the payroll portion of Peachtree's software means that in addition to printing employee checks, Peachtree payroll will calculate the amount to withhold from each employee's pay. After employees have been paid, you'll need to print a check or record a money order for the funds that have been withheld from employee's paychecks along with any taxes your company owes on the wages paid. Finally, you'll need to send the various required reports to state and federal tax authorities as the are due. In addition to dealing with the above payroll issues, you also need to deal with changes to payroll taxes, withholding amounts, and the method by which these amounts are calculated. Most payroll tax changes occur only at the end of each year, but there are exceptions. Federal income tax withholding can change mid-year and state unemployment insurance (SUI) rates frequently change during the year. In most states, the amount of state income tax withholdings is based on a percentage or on some other factor that does not change from one year to the next, but these methods of calculation can change too. Sage Software (the maker of Peachtree) offers a payroll update service to their software users to make all this easier. The idea of the payroll update service is that you pay an annual fee of about $230.00 and in return the manufacturer sends you periodic updates which include formulas and tables for calculating your federal and state payroll taxes. One advantage of using Peachtree instead of competing systems for payroll processing is that with Peachtree you are not required to pay an annual fee to update your software. Instead, Sage Software gives users the option of updating their payroll tax tables and formulas manually whenever changes are needed (generally at year-end). Because the alternative to manually updating is to use the Peachtree Payroll Tax Service at $229.95/year (list price) (or $195.00/year through this website), the manual updating option can save your company a significant amount of money as the years go by. On the other hand, only small changes in tax tables are generally needed from one year to the next. Because of this, many companies choose to save the expense of the Peachtree Payroll Tax Update Service and manually make any changes that are required in the way their taxes and withholdings are calculated. These manual tax rate changes are entered into Peachtree payroll using the command FILE/PAYROLL TAX TABLES/USER MAINTAINED. The information you'll need to enter into this screen is found by referring to a common federal booklet: Circular E (Publication 15). In your Circular E, start with the section called WHAT'S NEW. This section shows the Social Security Wage Limit for the year ahead. Next, use Table 5 in the Circular E to find the new amount of each Withholding Allowance. Now look at the Tables for Percentage Method of Withholding - Table 7 to obtain the new figures that will be needed for the Income Tax Tables. Finally, if you have state income tax, look in your state income tax publication to see if any changes are necessary and what new amounts are required. Manually updating the federal tax amounts in Peachtree typically takes about 20 minutes. If this is your first time manually updating, Click here and see how we can help you with this task. |