Small Business Payroll Services

Payroll ServicesIn the USA it is mandatory for employers to pay for Medicare, Local, State and Federal Taxes for their employees. In the process the employer deducts a portion of taxes and fees from the employee paychecks. Needless to say all these transactions are recorded for audit and reporting purposes.

Payroll Services – What does this entails
A payroll services company does all these activities for a fee, so that the business owners can use their time for other business activities. Once a contract is signed between the business owner and payroll service company all that the business owner has to do is to provide the service company with list of employees, hours that they worked and adjustments therein. The payroll services company then processes this data, does a fund transfer from the employer account to the payroll service account and disburses the salaries either through standard checks or direct bank deposit. The same is intimated to the employer through payroll and tax reports.

In addition to the standard payroll management services offered, payroll service companies like CheckMark, Inc. offers additional services such as benefit administration, retirement services, vacation and time-off calculations etc. The spectrum of services offered encompasses tax payments, labor management, tax compliance etc. The fee charged for handling these tasks depends of the account size which normally revolves around the no. of people on the payroll list.

Payroll Services – Evolution and Ticking
Many companies big and small have laid the baseline format for the payroll service industry operations and the field seems to be still evolving with the advent of new technology and working methods. Today a signed-in employer can enter his payroll information into the services portal and get the transaction done within minutes. At any point in time the employer can view their records with click of a button and also update the same at run-time. Reporting is fast, accurate and saves the employer from IRS penalties.

Payroll Services Company – How to Choose
Of course it is also true that there have been instances of fund theft and misappropriation due to computerization. It is still recommended to research for the various options available in terms of the payroll services companies, their work practices, reputation and customer testimony. Care has to be taken as the signed-up payroll service company will have access to the most confidential records of the employer. Also, if payroll Service Company fails to file for taxes on time, the signed-up employer’s company will be held responsible and will be liable for prosecution and monetary penalties. All that said, the signing up of a payroll service company has long list of benefits which cannot be overruled viz: more time for the employer to focus on main business activities, don’t have to hire a full-time accountant for payroll purposes, gets his payroll work done as per the best practices in the industry etc – to name a few.

Small Business 1099-MISC Guidelines and Requirement

Small Business Tax Filing

Form 1099-MISC primarily gives information about independent contractors to the IRS.

As per the guidelines from the IRS businesses are required to submit information returns. Form 1099 is used to report remuneration earned by an independent contractor. There are 17 types of 1099 forms, and IRS defines small businesses as the ones having gross revenues of $5 million or less. Form 1099-MISC is used by these small businesses.

What needs to be Reported
Form 1099-MISC is used to inform payments of services only that are related operating a company when the payments are equal to or in excess of $600 in a given year. The rules of eligibility to report are straight forward – small business owners who have paid to seek services from an unincorporated vendor which must be at least $600 in the accounting year are defined by the IRS to report Form 1099-MISC. It is mandatory that the reporting be done for services only and that to from unincorporated vendors – for instance seeking services for software installation from XYZ Computers needs to be reported in Form 1099-MISC.

Who needs to Report
Internal Revenue Services has laid clear guidelines for the 1099-MISC reporting – the four conditions that are to be met are – the payments should be made to a individual (not an employee), payments that are done to seek services that are essential for running the business, the payments that is atleast $600 for the accounting year. As an example – payments of atleast $600 for the year made in favor of architects, lawyers, contractors etc are liable to be reported in Form 1099-MISC. Also, payments made to the employee’s nominee after the employees death is to be reported using a 1099-MISC. Small business owners in order to file the 1099-MISC would need each individual’s taxpayer identification number. The Form with the IRS approved format can be printed using CheckMark’s 1099 Software, also the business owner may try the e-File version of 1099 software to fill in the values and post it directly to the IRS electronically.

How to File
The small business owner has to file one copy of the 1099-MISC with the IRS and the second copy has to be handed over to the person/individual whose services were used. As said earlier the business owner can e-File the same to the IRS. Forms downloaded from IRS website cannot be scanned and filing non-scannable forms can result in penalty. As already mentioned CheckMark’s 1099 software print version is capable to print out Form 1099 as per IRS directives after the values are placed. You may file the print version manually or try the CheckMark’s 1099 Software e-File version which has print and electronic submit feature.

IRS Penalties
As per the small business jobs act IRS has placed stringent rules to maintain accurate and timely submission of Form 1099-MISC for small businesses. Some of the broader penalties are mentioned below. Filing Form 1099-MISC late but within 30 days of the deadline incurs a penalty of $30 per 1099 submission to as high as $75,000. Filing with inaccurate data incurs a minimum of $250 per 1099-MISC submission and is categorized under – intentional disregard to provide accurate information.

How to set-up Small Business Payroll System

Small Business Payroll SystemSetting up of payroll systems is one of the most important tasks that a small business employer should do at the time of establishing their business. Setting up small business payroll system not only helps in identifying and streamlining the overall business process but it also assist the business owner in delivering the various legal and regulatory responsibilities towards the Internal Revenue Service (IRS).

We believe the 10 steps mentioned below are a good start for any business owner on how to set-up a payroll system for their small businesses -

  1. Employer Identification Number (EIN) – Get this first - Even before bringing their first employee on board, the small business employer should approach the IRS to get their unique employment identification number (EIN). Also, referred to as Employment Tax ID (Form SS-4). EIN is in many ways including reporting of taxes and other IRS documents, reporting about the employee to the state agencies. Business owners can apply for EIN online or by directly approaching IRS.
  2. State IDs or Local IDs? – Be sure what you want – As a small business owner you should know this, as many state (local) governments will need this ID for processing your taxes.
  3. Employee v/s Independent Contractor – Be very clear – From filing taxes point of view there is a huge difference between a company employee and independent contractor. Though not very clear in definition it is highly recommended to get this clarity from IRS itself as it affects how you file your taxes etc.
  4. Employee Paperwork – Make sure this happens on time – For All employees who are newly recruited it is mandatory that they fill Federal Tax Withholding Form W-4 and return it their respective small business employers. The employer can use this to withhold actual income tax from their salaries.
  5. Payroll Schedule – What is best for you – Sometimes governed by state laws, determining payroll schedule whether monthly or bimonthly is also a building block in setting up of your small business payroll system. As per the directives from IRS the employer has to withhold the income tax even if the employee leaves before the time period.
  6. Employee Compensation Terms – Document Everything – Employee compensation terms should necessarily mention the paid time off, contribution towards health insurance coverage premium and contribution towards retirement funds. You should also decide on how you are going to track the employee hours and how (if at all) you would pay employee for over time.
  7. Automate it – Payroll Software System – Decide among the options of getting payroll done as an outsourced service from a payroll services provider or getting it done in- house using a payroll software system. For choosing in-house payroll software system, compare the various products against their respective features and their pricing model. Some of the solutions out there in market charge annually while others use monthly pricing model. Some are cloud based solutions while others are standalone payroll applications. Also, consider the learning curve that would be involved in getting a hang of the software. While in-house payroll system offers benefits in terms of greater control over the process, outsourced payroll service offers benefits in terms of cost cutting as you don’t have to hire a payroll professional for doing it for you. Whatever you decide, as an employer you have to make sure that the payroll is run on time and payments are done duly with accuracy.
  8. It all comes down to this – Payroll Run – With everything in place it’s time to run your payroll software. Be sure you have all the regulatory and legal checks in place and your payroll software is configured accordingly as per state and federal laws. You may now enter the information manually or hand over the data to your accountant.
  9. Maintain Records – Legally Speaking – Small Business Employers are expected to maintain certain documents regarding the employee for a specified time period. For instance Forms W-4 is to be maintained for all current employees and should be with the employer for three years after the employee left the organization.
  10. Payroll Taxes – The Reporting – This is the perhaps the most important reason for a small business employer to setup their payroll system – reporting. As a business owner it’s your responsibility to submit various tax related documents and forms to the appropriate authorities. For any doubts, it is recommended that you spend time with the IRS website and go through their Employer Tax Guide.

1095 Filing – Deadlines for 2016

Self-insured employer, government agencies, issuer of health insurance and any other business entity that provides health coverage to a full-time employee are required to report the details of the coverage provided to the IRS. Business entities that are ALE’s (Applicable Large Employer) are supposed to report all the coverage information to the IRS that is pertinent to its full-time employees. IRS categorizes ALE’s (Applicable Large Employer) as one who has minimum 50 full-time employees.

1095 Filing Deadlines for 2016

You may file the 1095 Forms to the IRS using CheckMark 1095 software. The due dates for 1095 Filing as released by IRS are given below. Make sure that you mark them as reminders in your calendar. As per the requirements and conditions stated in this article you may decide to use CheckMark 1095 software with either the print or with E-Filing capability -

  • Companies handing over Forms 1095-B and 1095-C to individuals by Feb. 1, 2016.
  • Companies filing the Forms 1094-B, 1095-B, 1094-C and 1095-C with the IRS not later than Feb. 29, 2016 if filing on paper and March 31, 2016, if filing electronically.

ACA 1095 Deadlines

Health Coverage Providers – Reporting

Companies providing minimum essential health coverage for the calendar year must report an information return and a transmittal to the IRS. Mostly for this purpose transmittal Form 1094-B and information return Form 1095-B will be used. However, employers (including government employers) supporting self-insured group health plans will report about the coverage in Form 1095-C.

Employers having less than 50 full-time employees and who do not sponsor the employer shared provisions for health coverage, but do sponsor self-insured group health plans, should use Forms 1094-B and 1095-B to report coverage information about individuals.

As one of the striking features of CheckMark 1095 software – it is super easy to create as many employee entities in its database as you want at lightning fast speed.

Applicable Large Employers – Reporting

Business entities with 50 or more full-time employees (full-time equivalent employees) should use Form 1094-C for transmittal and Form 1095-C for reporting information required under ACA (Affordable Care Act) about various offers on health coverage and enrollment in health coverage of their employees.

Additionally, to report the health coverage that the employers offer, ALE’s (Applicable Large Employers) sponsoring self-insured health plans are supposed to use the Forms 1094-C and Forms 1095-C for reporting about the coverage that they provide to their enrolled employees.


Affordable Care Act – Explained

With Affordable Care Act (ACA) aka Obamacare in place certain employers are required to offer health insurance coverage to their full-time employees. These employers should send an annual statement to all the employees eligible for this coverage. The statement describes the insurance available for them.  Internal Revenue Service (IRS) Form 1095-C is used as that statement.

Who should file Form 1095-C?

The ACA clearly defines which employers have to offer health insurance to their employees. ACA refers to them as “applicable large employers,” (ALEs). A company/organization is an ALE if it has minimum 50 full-time employees. Full-time employee, as per ACA, is someone who works minimum 30 hour/week. Only ALEs are required to file Form 1095-C.

What is 1095-C
Employee of an ALE who is eligible for insurance should receive the form 1095-C. Eligible employees but declining to participate in employer provided health plan will still receive a 1095-C. The form typically includes:

  • Details of the employee and the employer.
  • Months of the accounting year the employee was eligible for insurance.
  • Cheapest premium cost that the employee could have paid.

1095-C will indicate the fact if an ALEs does not offer its employees with insurance coverage. But such ALEs may be subject to financial penalties.

When does 1095-B comes into picture

Where 1095-C only describes what kind of insurance coverage was made available to a full-time employee, form 1095-B contains the details about the employee’s actual coverage, including the details of the employee’s family dependents that are included in this insurance coverage. Form 1095-B is sent out by the insurance provider and not the employer.

Some companies pay medical bills for their employees themselves, meaning they are self-insured-

  • For such cases employer is the insurance provider, so it will send out 1095-B forms.
  • For such cases “B” and “C” forms can be combined and sent together by the employer.

When 1095-C is supposed to go
Starting 2015 tax year sending out 1095-C forms has been made mandatory. Employers have to send these out to their full-time employees and also to the IRS. Employees should receive them by the end of January — so in January 2016, forms for 2015 tax year will be sent.

Employers filing paper forms will have time till February 2016 and if they are filing electronically will have time till March 2016. Employers having employees 250 or more have to file the forms to IRS electronically only and those who have full-time employees less than 250 have the option to file in paper or electronically. Dates have to be maintained strictly to avoid any kind of penalty from IRS.

5 Ways to set Small Business Goals

Setting goals and moving forward has always been a tough call, business goals are no different. Putting it all together on paper being the easy part, implementation and taking action for the same may take a back seat owing to procrastination or something else. Some may also call the art of formulating the goals as a total waste of time and frustrating exercise as one never achieves those no matter what.

In the article below I would like to bring forth few easy and doable techniques that are sure to not only change your perspective on goal setting but would also leave you doing something in this regard the moment you finish reading what I propose. Giving time in analyzing your current business situation and what you aspire to be empowers you with a thorough knowhow of your state and this would help you in taking an informed and intelligent course of action. The five ways below presents a realistic approach towards goal setting for your small business and would ensure that you don’t fail in achieving them…ever!

1. What is your Current Situation?

Be clear with your current business situation and standing and what your ambitions are for it. Be clear and better put it on paper. It is highly important that you be absolutely certain about your financial standing, business accounts, money in bank accounts, sales that are due and the overall business process. Once the picture of your business standing is drawn with the minutest details, you are ready to take it to next level – i.e. the business standing that you want and goals that you should achieve to signal that you have achieved what you started for.

2. Roadmap it with diligence

Your Road map should typically have a five-year horizon. Though the final list of goals may seem a bit overwhelming initially, keep in mind that you have to break them further into sub-goals, something that you would achieve by the end of the year. With experience you would also appreciate that these yearly measurable goals helps in formulating and clarifying your overall vision.

3. Be Micro Task Oriented

Going further ahead you have to calibrate your yearly goals against weekly and monthly achievable tasks. This may typically include sales goals, revenue goals. For instance, if you want to see a rise in the month over month sales goals you will have to increase the cold calls effort every week or maybe outsource warm leads from a third party to increase the no. of call and achieve the sales goal.

4. Stay Focused, Stay Put

Creating the goals and working for them is good but it doesn’t guarantee success unless the efforts are consistent and seamless. Sticking with your micro-tasks and keeping the bigger picture/vision in your view requires focus. A lax in the daily and weekly routine and tasks wouldn’t harm if done once in a while, but a regular lapse would be detrimental in your race towards your goal. So be vigilant for such occasions and make it up by working for extra hours.

5. The Key – Work Hard and Organize yourself

This is perhaps the most important but often less understood ingredient for your success. Several entrepreneurs spend the entire day carrying out usual business activities but don’t priorities their activities and act accordingly. Instead, it is suggested proper time and resources should be shelved out so that the entrepreneurs could spend satisfactory amount of time in working towards achieving their yearly goals and weekly tasks deliverables. Organizing your time this way will leave with more energy by the end of the day to think clearly and on the ground.

Why Small Business should use Cloud Computing

The way information technology has transformed the world, cloud computing is poised to take it even further and radically change the way businesses operate and deliver. IT experts round the globe consider cloud computing as one robust environment that would enable the businesses to be faster, cheaper, portable and safer, be it large enterprises, medium size businesses or small businesses.

Companies have realized that their products and services can reach a wider spectrum of target audience with an even lesser cost. Based on the research done by Microsoft – 45% of the small businesses have shown interest in cloud computing and are committed to give it a try for various reasons. We at CheckMark Inc. have also taken up the cloud computing endeavor to deliver our flagship products viz: CheckMark Payroll Software, MultiLedger (A Small Business Accounting Software) and 1099 Software through a cloud computing platform. We are collaborating with Microsoft itself in developing our cloud based softwares using their Azure platform.

For many small businesses like us there could be a plethora of reasons to take up cloud computing model for their products, some of the most prominent ones are mentioned below –

  • Cost Reduction – This is the most common one. Not only that cloud computing reduces the hardware cost to the minimum but also saves on the hardware maintenance and the overhead of a dedicated staff. Moreover, the cloud computing model is promising for a startup model with limited budgets. With the cloud computing model the dollar travels more in returns without compromising on usage of the latest technologies.
  •  Increase Data Security – With the big guns like IBM, Google, Amazon hopping in the cloud computing model, the technology development focus was shifted towards security and encryption. That said, the latest platforms available today are all high on providing data and application security. Small businesses with budget constraints can make use of cloud computing and get world class security and data encryption facility at a fraction of the cost.
  • Possibility to Work Remotely – Cloud computing gives the ability to access your files, products from anywhere at any time. Stored in the cloud infrastructure, documents and information can be accessed from anywhere with just an internet availability. In the small business setup, this very feature can assist in reducing the IT infra cost for the operations, where the employees can work full-fledged on the same project either from home or anywhere.

Cloud computing allows small and medium companies to be in equal terms with large companies in terms of their IT infrastructure, helping them to compete with more rigor and quality in the market.


Payroll, MultiLedger and 1099 updates for 2016

Announcing the availability of the 2016 versions and annual updates of our Payroll, MultiLedger and 1099 software. The new versions and updates contain new tax tables, new forms, enhancements, and bug fixes. The details of the update are listed below -

Payroll Updates – version 16.0.0

Updated features of CheckMark Payroll software are listed below -

  • Employers can now setup and create ACH payments to their bank or through National Payment Corporation to pay their Employer payments, such as tax payments and payments for deductions (401k, insurance, garnishments, etc).
  • There is a new option in the deductions match to be able to take a % of what is deducted from the employee’s check.
  • Added another option to the Calculation Method in Accrued Hours – you can now accrue hours on a quarterly basis.
  • Added a new report – it combines the Employee Earnings Register and the Employee Hours Register into one report.
  • There’s a new option to export the Company Information from Payroll into the 1099 program.
  • Adding the ability to distribute the tax expense accounts into departments and the different expense accounts within the department accounts.

MultiLedger 7.8 – Updates

The new updated features rolling out with MultiLedger 7.8 are –

  • Increased the length of the password field to be able to accommodate up to 10 alphanumeric characters.
  • Added a Subtotal line for each Customer on the Customer’s Invoice Item Detail report to include totals for both the quantities and the amounts. Also added a Grand Total line at the bottom of the report for both Quantity and Amount.
  • Added a Subtotal line for each Vendor on the Vendor’s Item Purchase Detail report to include totals for both the quantities and the amounts. Also added a Grand Total line at the bottom of the report for both Quantity and Amount.
  • Updated 1096 & 1099 forms to be current for 2015 filing.

CheckMark 1099 Updates for 2016

The features rolling out with 1099 software are listed below-

  • Added a Database Manager to allow users to create multiple databases in multiple locations.
  • Added an option to print Labels.
  • Added new checkbox to 1099 MISC, DIV & INT for the new FATCA filing requirement.
  • Added the ability to import Company Information in a tab-delimited text file format.
  • Added buttons for “Previous” and “Next” within each recipient type to be able to move back an forth between recipients without having to close the data entry window and reopen it for each recipient.


CheckMark, Inc. among the Top 10 Payroll Software Companies in USA



Fort Collins, Colorado – HR Tech Outlook a premium pro-HR magazine has recognized CheckMark Payroll Software as one among the Top 10 in USA for small and medium size businesses. CheckMark Payroll was chosen based on its comprehensive functionality, cost effectiveness, and scalability.

Speaking on the occasion Director of Sales and Marketing, Mr. Syed Abdul Hakeem said, “These are very exciting times for us. Not only that we are observing a growing trend of startups and small businesses that enliven the market and challenge us to reach out but also our recognition as a dependable name when it comes to Payroll Software and Solutions.  It keeps us strategically focused and hungry for more”. “We are a Small Business ourselves and understand Small Business needs, Payroll Processing and Automation is in our DNA,” added Mr. Hakeem.

Payroll has become complex and the penalties can be severe if not processed correctly. Technology helps perform the payroll tasks more effortlessly. CheckMark offers cost-effective payroll software solutions to companies in the small and medium segment. We have been a leader in this segment since 1984, serving a customer base that runs in thousands across the Windows and Mac platforms.

CheckMark Payroll can be used as a stand-alone program, or it can be integrated with most popular accounting systems, including CheckMark’s own MultiLedger™ Accounting System to provide seamless transfer of valuable data. Some of the software’s features include Direct Deposits, MICR encoding blank check stock, ability to handle unlimited companies and unlimited employees. The software will calculate Federal and State tax withholding tables and printable IRS forms are included, and there is no monthly fee.

CheckMark’s product line includes Payroll Software, MultiLedger™ Integrated Accounting Software, 1099 Software and the new 1095 Software related to the Affordable Care Act (ACA). CheckMark also has a wide array of services offerings for Payroll, Accounting, HR and Time Keeping Solutions. CheckMark is currently, partnering with Microsoft Corporation in developing a Cloud Environment and reshaping their products to make them functional in this environment. Through this collaborative effort, CheckMark will facilitate customers in accessing applications using multiple devices to complete their work easily and more securely. CheckMark has plans to incorporate new features, and modules, in their product line and build an ERP System geared towards the Small and Medium size businesses.

3rd Quarter Newsletter 2015

3rd Quarter NewsLetter -CheckMark Inc

A Word from Our CEO:

July 2015

Dear Customers,
Wow, how quickly time goes by! We are over halfway through 2015 and there is a lot happening at CheckMark. We are diligently working on enhancements of our flagship products, Payroll, MultiLedger, and 1099 for 2016.  We are also working on the development of a new 1095 reporting software application, which is due for release later this year.  This new application will help you with all your reporting needs with the Affordable Healthcare Act (ACA).  We will provide you with more information on this soon.

As always, we are watching what new legislation and changes are being proposed so we can incorporate them as soon as they are passed.

You may be hearing a lot about software in the “Cloud”.  We have been researching this for some time and have decided that the cloud technologies have finally become mature and secure for our use. CheckMark is partnering with Microsoft to build a version of our software applications in this environment. The cloud environment will allow the applications to be securely used from desktops and laptops, as well as mobile devices like iPads and Tablets from any location where an internet connection is available.

We will of course, continue to enhance and provide our current desktop applications. In fact, we are exploring ideas on how we can incorporate and leverage the cloud technologies for the desktop applications. Watch for some new features being offered soon.

We will continue to do what we do best – developing state-of-the-art software products and services that provide value to our small & midsize business customers across the US and Canada.

Thank you and best regards,

Mohammed Ghani
President and CEO


Now is a good time to switch accounting software
If you are not using MultiLedger yet, mid-year is an easy time to switch accounting packages. MultiLedger can handle your small business bookkeeping, invoicing, payables, track inventory, job cost, monitor cash flow, get up-to-the-minute reports, and much more in one sleek package. Check out our free demo and see for yourself!

Payroll Support Tip

New sick pay law implemented by California – 07/01/2015
The new Sick Pay law establishes a minimum requirement, but an employer can provide sick leave through its own plan or establish different plans for different categories of workers. However, each plan must satisfy the accrual, carryover and use requirements of the law or put the full amount of leave into your leave bank at the beginning of each year in accordance with the PTO policy. Read More

How to Close Your MultiLedger Year & Make a Backup

July 1 is the start of the close year for most users. If you have 30 months open it may be time to close the year. When you close the year it will close the first 12 months and open 12 more. The instructions on closing your year can be found in the Help menu of the program, in the MultiLedger Manual; Chapter 10 “Closing the Year”.

Please make backups before closing your year. You should be doing this as often as you are willing to re-enter your information, at least weekly, if not daily. Go to the file menu of the program to “Backup Company”. We do not support any other backups other than our own. Even if you have your own system backing up your hard drive you need to use our backup system. The other backup systems do not always work correctly and we often see people lose years of information because they are not using our backup function in the program. It is best to save your backups off of your computer’s hard drive in case the computer crashes. We recommend saving to a server or a flash drive.


HR Support Center is a great resource for many of your HR needs. Access to this website allows you to look up recent and old laws regarding HR processes for both Federal and State. You also have access to HR templates for employee handbooks and other HR correspondences. This is a great solution to help you understand and manage your HR compliance and employee relations questions. The HR On-demand option allows you to directly ask HR-pros for help in looking over documentation or specific questions on how to deal with certain situations.


Swipeclock is a great way to automate the time keeping aspect of your business and help streamline your payroll process. You can minimize human error, eliminate paper, have employees clock-in via time clocks, web or even mobile phones. Swipeclock offers real time reporting, scheduling, time accruals, and many other features. You can easily import the hours from Swipeclock into CheckMark Payroll. This program is easy to set up and use. All you need to do is plug in and sign on, there’s no programming needed.

For more details or to order this or any of our other products and services, please give us a call at 1-800-444-9922 / 1-970-225-0522.