If you've just hired your first employee, or you're about to, payroll software helps you calculate paychecks, withhold taxes, file payroll forms, and pay workers on time. It moves money from your business checking account to your workers on a schedule and files the tax returns that follow.

Compare the payroll tools most small businesses pick, view the real math for a 5-person team, and see how payroll interacts with a business bank account. If the money isn't there on debit day, none of the software matters.

What is the best payroll software for small business?

Every option below is full-service, which means the provider files your federal, state, and local payroll taxes for you. That includes quarterly Form 941 and annual Form 940, plus W-2s and 1099-NECs at year-end.

| Software | Starts at | Per employee | Contractor-only plan | Novo integration | |---|---|---|---|---| | Gusto | $49/mo | $6/mo | Yes, per-contractor only | Native — see next payroll debit date and amount in Novo | | OnPay | See vendor site | See vendor site | Included in single plan | Via ACH from Novo checking | | QuickBooks Payroll | Published pricing varies by plan | Varies | No standalone plan | Via ACH from Novo checking | | Patriot Payroll | Published pricing varies (Full Service tier available) | Varies | Basic plan supports 1099s | Via ACH from Novo checking | | Square Payroll | Published pricing varies by plan | Varies | Per-contractor rate, no base | Via ACH from Novo checking | | Rippling | Quote-based | Quote-based | Global contractor payments | Via ACH from Novo checking | | ADP RUN | Custom quote | Custom | Contractor payments add-on | Via ACH from Novo checking | | Paychex | Custom quote | Custom | Contractor plans available | Via ACH from Novo checking |

Pricing above reflects published vendor rates at the time of writing; check each vendor's site for current numbers before signing up.

How we built this list: we scored each provider on published pricing, contractor support, tax filing coverage in all 50 states, and business-checking ACH setup.

What does full-service payroll software actually do?

Full-service payroll software handles payroll tax calculation, withholding, filing, and payment tasks that many owners prefer not to manage manually.

What the software handles:

• Direct deposit for W-2 employees and 1099 contractors
• Payroll tax calculation, withholding, and filing for federal (Form 941 quarterly, Form 940 annually), state, and local taxes
• Year-end W-2s for employees and 1099-NECs for contractors
• State new-hire reporting

What you still have to do:

• Fund your business checking account before the debit date. Providers pull the money via ACH a day or two before payday; if the balance is short, payroll fails.
• Register for state payroll tax accounts in every state where you have workers. The provider files the returns, but the accounts have to be in your name.
• Classify workers correctly. W-2 vs. 1099 is your call, and the wrong call is expensive.

How employer FICA taxes work.

If you pay an employee $5,000 in a pay period, you withhold $310 (Social Security) plus $72.50 (Medicare), totaling $382.50 from their check, and you owe another $382.50 from the company. Payroll software handles the arithmetic; you just need the cash on hand.

How do you choose payroll software for your small business?

Consider these five factors to narrow down the options:

1. What's your employee mix? W-2 only, contractor only, or a mix of both. Contractor-only businesses should not pay for a full W-2 plan. Most providers offer a contractor-only tier with no monthly base fee.

2. How many states do you run payroll in? Multi-state filing is often an add-on. If you have one remote employee in another state, ask what that costs.

3. What benefits do you offer? Health insurance, 401(k), and workers' comp integration vary widely between providers. Gusto and OnPay tend to bundle benefits admin at lower tiers than the enterprise incumbents.

4. What accounting stack are you already on? QuickBooks Payroll is often a practical fit if you already keep your books in QuickBooks Online. If you use Xero or FreshBooks, compare payroll integrations before choosing QuickBooks Payroll. For a broader review of bookkeeping tools that pair well with these payroll options, see our guide to the best accounting software for small business.

5. What's your business bank account? Payroll debits your checking via ACH. You want visibility into the upcoming debit amount and date so you can confirm the balance covers it. This is where Novo's native Gusto integration matters: the next payroll debit surfaces inside the Novo dashboard.

What is the best payroll software for a new LLC?

If you're a single-member LLC with no employees, you probably don't need payroll software yet.

A single-member LLC is treated as a disregarded entity by default for federal tax purposes, meaning the owner takes draws rather than a W-2 paycheck. Draws are not payroll and aren't run through payroll software.

If your LLC has elected S-corp taxation, you must pay yourself "reasonable compensation" as a W-2 employee. That's when payroll software becomes necessary even if you're the only person on payroll.

If your new LLC is hiring its first W-2 employee, Gusto is a common starting point: full-service tax filing in all 50 states, benefits admin, and a native Novo integration so you can see the payroll debit inside your bank dashboard.

If your new LLC only pays contractors, use a contractor-only plan. Gusto's contractor-only tier charges per contractor per month with no monthly base fee, and files 1099-NECs at year-end.

Setup order for a new LLC:

1. Get your EIN from the IRS (free from the IRS, takes about 15 minutes online).
2. Open a Novo business checking for LLC account online with the EIN.
3. Register for state payroll tax accounts in every state where you have workers.
4. Sign up for payroll software and connect it to your Novo account. Expect 1–2 business days for the provider to verify your bank via ACH micro-deposits before the first run.

What are the top payroll software options for small businesses?

Gusto: best overall for most small businesses

Gusto is a common starting point for new LLCs and businesses under 50 employees. It offers full-service tax filing in all 50 states, benefits administration, and contractor payments.

It's also the payroll tool with the deepest Novo integration; the next debit date and amount show up inside the Novo dashboard, so you're not guessing whether the account will cover payroll.

Fits: most SMBs and new LLCs. Skip if: you need enterprise HR features or you're already deep in QuickBooks Online.

OnPay: one plan, one price

OnPay charges a single flat rate that includes tax filing in all 50 states, benefits, and contractor payments. OnPay offers a single flat-rate plan rather than tiered pricing.

Fits: owners who want predictable pricing and don't need HR add-ons.

QuickBooks Payroll: best for QuickBooks Online users

QuickBooks Payroll is the obvious pick if your bookkeeping already lives in QuickBooks Online. Same login, payroll expenses land in your books automatically. Three tiers (Core, Premium, Elite) with unlimited payroll runs on all of them.

Fits: existing QuickBooks Online users. Skip if: you use Xero or FreshBooks.

Patriot Payroll: low-cost full-service option

Patriot Payroll publishes one of the lowest base prices among full-service payroll providers we reviewed. Patriot's interface is simpler than some higher-priced tools, but its full-service plan covers payroll tax filing at a lower published base price.

Fits: cost-sensitive owners with straightforward payroll in one or two states.

Square Payroll: best for Square merchants

Square Payroll pulls hours directly from Square POS timecards, which matters if you run any service business with hourly staff on Square. Contractor-only plan available at a flat per-contractor rate.

Fits: existing Square merchants.

ADP RUN and Paychex: for scaling past ~50 employees

ADP RUN and Paychex both quote custom pricing and lean on dedicated payroll specialists. Overkill for a 3-person LLC; a reasonable fit once you're past 50 W-2 employees or need hands-on HR support.

Fits: growing businesses that want a person on the phone, not a chatbot.

Best payroll software for contractors (1099-only)

If you don't have any W-2 employees, don't pay for a W-2 plan.

• Gusto Contractor-Only: per-contractor fee with no monthly base fee; files 1099-NECs at year-end.
• Square Payroll Contractor: flat per-contractor rate with no base fee.
• QuickBooks Contractor Payments: flat per-contractor rate and QuickBooks Online integration.

One warning about 1099 vs. W-2.

Misclassifying an employee as a 1099 contractor can prompt the IRS and Department of Labor to reclassify the worker and assess back taxes and penalties. When in doubt, ask a CPA before the first payment goes out.

Payroll software pricing: what a 5-person team actually pays

Almost every provider charges the same way: a monthly base fee plus a per-employee fee.

Worked math for a 5-employee team (using each vendor's currently published rates; check the vendor site before signing up):

• Gusto Simple: $49 base + ($6 × 5) = $79/month
• Patriot Full Service: check Patriot's site for current base and per-employee rates
• OnPay: check OnPay's site for current base and per-employee rates
• QuickBooks Payroll Core: check Intuit's site for current tier pricing
• Square Payroll: check Square's site for current base and per-employee rates

Contractor-only plans skip the base fee entirely. If you pay 3 contractors on Gusto Contractor-Only, you pay the per-contractor rate × 3, only in months you actually run a payment.

Add-ons that inflate the bill:

• Multi-state filing (often an added monthly fee per extra state)
• Same-day direct deposit (available on higher tiers)
• Benefits administration
• Workers' comp integration

Which emerging payroll tools should small businesses watch?

Rippling and OnPay may fit businesses that need global contractor payments or single-plan pricing.

Rippling

Rippling started as HR software and layered payroll on top, which is why it stands out for businesses that want payroll, benefits, device management, and app provisioning under one login.

Rippling supports global contractor payments and payroll in more than 100 countries, which may fit small businesses with international contractors.

Fits: tech-forward SMBs with remote or international contractors.

OnPay (deserves a second callout)

OnPay is worth comparing with Gusto and QuickBooks because it uses one published plan and includes multi-state payroll tax filing in that plan. Worth a real look if you don't need Gusto's benefits marketplace.

Can I run payroll from any business bank account?

Yes, but not from a personal account. Commingling personal and business funds weakens your LLC's liability protection and creates a bookkeeping mess at tax time. Most payroll providers ask you to connect a checking account during setup, and a dedicated business checking account helps keep payroll records separate from personal spending.

Payroll providers move wages and tax payments through the ACH network, so businesses should have funds available in their checking account before the scheduled payroll debit date. Payroll providers set their own debit deadlines, and ACH settlement timing means funds should be available before the provider's scheduled debit date. Miss the debit, and you're on the hook for NSF fees plus a failed payroll.

Novo offers business checking with no monthly fees, no minimum balance, and a native Gusto integration that shows the next payroll debit date and amount inside the Novo dashboard. Owners who want to earmark cash for payroll ahead of the debit can move it into business sub-accounts so the money isn't accidentally spent before payday.

Novo does not accept cash deposits. If your business takes cash, deposit it at a bank or credit union that accepts cash and ACH-transfer it to your Novo account. Plan 1–3 business days ahead of any payroll run.

Does Novo integrate with Gusto?

Yes. Novo has a native Gusto integration that displays your next payroll debit date and amount inside the Novo dashboard.

Novo says over 4,000 businesses have connected the Novo + Gusto integration.

How to connect:

1. Open the Novo app.
2. Go to Apps.
3. Search Gusto and connect your Gusto account.

Once connected, you can see upcoming payroll debits, confirm your balance covers payroll, and move funds in without leaving Novo. The Novo business checking application is designed to be completed online with an EIN, so a new LLC can open an account and connect Gusto without a paper process.

How can small businesses track payroll cash flow before debit day?

Payroll fails when the balance is short on debit day. Track it in a spreadsheet:

``` PAYROLL CASH-FLOW TRACKER — [Month/Year]

Pay date: _________ Debit date (T-2): ________ Gross wages: $________ Employer FICA (7.65%): $________ Employer FUTA/SUTA: $________ Benefits contribution: $_________

TOTAL PAYROLL DEBIT: $__________

Current Novo balance: $_________ Buffer (target 1.5x debit): $________ Transfer needed by [Debit date - 2]: $_________

Sources funding this payroll: [ ] Invoice #____ ($___, due ___) [ ] Stripe payout ($___, expected ___) [ ] Owner deposit ($____) ```

Tip: paste this template into ChatGPT or Claude and ask it to generate a working Google Sheet or Excel file with the FICA and total formulas already filled in. Example prompt: "Turn this payroll cash-flow tracker into a Google Sheet with formulas for employer FICA at 7.65% of gross wages, total payroll debit, and the transfer needed to hit a 1.5x buffer. Include 12 monthly rows."

Pricing at a Glance

Starting prices as of July 2026 — see each vendor's pricing page for current plans.

| Tool | Starting price | |---|---| | Gusto | $49/mo + $6/person | | ADP RUN | Custom quote | | Rippling | Custom quote | | OnPay | Custom quote |

User Review Ratings (Trustpilot)

Trustpilot scores as of July 2026 — click any tool for its current rating.

| Tool | TrustScore | Reviews | |---|---|---| | Gusto | 2.1 | 2,466 | | ADP | 1.3 | 3,046 | | Rippling | 4.5 | 2,141 | | OnPay | 4.1 | 304 |

Frequently asked questions

Do I need payroll software if I'm the only member of my LLC? Usually no. A single-member LLC is a disregarded entity by default, so you take owner draws rather than a W-2 paycheck. You only need payroll software if your LLC has elected S-corp or C-corp taxation.

Can I run payroll from a personal bank account? No. Use a dedicated business checking account to preserve LLC liability protection and keep clean tax records. Most payroll providers require a business account during setup.

How long does it take to set up payroll for a new LLC? Plan on a few business days. Get your EIN from the IRS, register for state payroll tax accounts, then allow 1–2 days for the payroll provider to verify your bank account via ACH micro-deposits.

Does Novo integrate with Gusto? Yes. Novo has a native Gusto integration that displays your next payroll debit date and amount inside the Novo dashboard, and Novo says over 4,000 businesses have connected it.

What's the cheapest full-service payroll software? Patriot Payroll publishes one of the lowest base prices among full-service payroll providers we reviewed. Check Patriot's site for current pricing.

Do payroll providers handle 1099 contractors and year-end 1099-NEC filing? Yes. Most full-service providers file 1099-NECs, and Gusto offers a contractor-only plan with no monthly base fee.

What forms does payroll software file for me? Full-service payroll software files Form 941 (quarterly federal payroll tax return), Form 940 (annual FUTA), state withholding and unemployment returns, W-2s for employees, and 1099-NECs for contractors.

Which payroll software should a small business choose?

For most small businesses, Gusto is a strong first option because it includes full-service payroll in all 50 states, contractor support, benefits administration, and a native Novo integration that surfaces the payroll debit inside your bank dashboard. Patriot competes on price. OnPay offers a single plan at one price. QuickBooks Payroll fits if you already keep books in QuickBooks Online.

Whatever you pick, the payroll software is only half the equation. The other half is a business checking account that gives you visibility into the debit before it happens, which is why Novo built the Gusto integration in the first place.

Disclosures

Novo Platform Inc. ("Novo") is a fintech, not a bank. Banking services provided by Middlesex Federal Savings, F.A., Member FDIC. Eligibility subject to final Novo determination.

Novo Platform Inc. ("Novo") strives to provide accurate information but cannot guarantee that this content is correct, complete, or up-to-date. This page is for informational purposes only and is not financial or legal advice nor an endorsement of any third-party products or services. All products and services are presented without warranty. Novo Platform Inc. does not provide any financial or legal advice, and you should consult your own financial, legal, or tax advisors.