Enter your business details to see what each option would cost you. Prices are live from our database and shown in US dollars.
Payroll is where a small business first meets the IRS as an employer, and the penalties are the reason to take the software choice seriously. Get a federal deposit late and the penalty escalates with the delay. Hire someone in a second state and you have a registration, a withholding obligation and a return you did not have last quarter. Misclassify an employee as a 1099 contractor and you can owe back taxes and penalties for the whole period. Good payroll software does not just cut the checks; it files the returns, tracks the deadlines, and keeps you out of that. Below are our ranked picks, then a live calculator to cost each at your headcount.
How we chose
Small businesses weigh payroll on compliance first, then real monthly cost, then whether it fits the tools they already run. We ranked on the depth of full-service tax filing (federal, state and local, and whether it is on every tier or gated behind an upgrade), W-2 and 1099 handling in one system, multi-state support, benefits administration and workers comp, and the real monthly bill once you count both the base fee and the per-employee fee. Plans and pricing checked October 2026, and every figure on this page is pulled live from our database rather than typed in by hand.
The base fee plus per-employee trap
Almost every US payroll product is priced the same way: a flat base fee, plus a fee per person per month. That makes the headline number nearly useless on its own, because the two halves swap importance as you grow.
At two employees the base fee is a large share of your bill. At twenty-five, the per-employee fee dominates and the base fee matters far less. Patriot Software's base is $37/mo against a per-employee fee of $5/emp/mo; Gusto's entry plan is $49/mo plus $6/emp/mo. QuickBooks Payroll is sold mainly alongside a QuickBooks Online plan, with Intuit's pricing page showing payroll bundled with those plans, and a per-employee fee of $7/emp/mo; the table carries the figure we hold for the rest. Deel, by contrast, prices US payroll with no base fee and a per-employee fee, partly on quote, so how it compares with the base-fee providers changes with headcount, which is exactly why the calculator above exists: put in your real employee count instead of comparing the numbers on the vendors' homepages.
Full service is not a marketing word
"Full-service" has a specific meaning in US payroll: the provider withholds your payroll taxes, deposits them with the IRS and each state on the correct schedule, files the quarterly 941 and the state returns, and issues W-2s and 1099s at year end. It generally comes with a tax-penalty guarantee, which is the part you are really buying.
The alternative is self-file, and it is not a trap so long as you know you are choosing it. Patriot Software's Basic tier is the honest version of it: cheaper, and it hands you the deposit calendar. That is a fair deal for a business with one or two employees in one state and a bookkeeper who is on top of it. It is a bad deal for a business that is about to hire in a second state, because the compliance surface roughly doubles and the savings do not.
Every state you hire in is a new set of paperwork
This is the cost small businesses do not see coming. Hire a remote employee in another state and, before their first pay run, you generally need to register as an employer with that state's revenue department and its unemployment insurance agency, obtain account numbers, and start withholding under that state's rules. Some states add local city taxes on top. Every provider in this ranking supports multi-state payroll (on Gusto it needs a higher tier: its row reads Yes (Plus)), so the software will file once you have the numbers, but obtaining them is on you unless the provider explicitly offers a state registration service. Ask before you hire, not after.
The same care applies to workers compensation, which is a state-mandated insurance rather than a payroll tax and is required in nearly every state as soon as you have employees. Gusto, OnPay, Patriot Software and QuickBooks all offer pay-as-you-go workers comp, which spreads the premium across pay runs off actual wages rather than an annual estimate and a true-up. If you have employees, that is not optional coverage.
W-2 or 1099, and why the software will not decide it for you
Every pick here files both, so the system is never the constraint. The classification is, and it is yours. A worker who sets their own hours, uses their own tools, serves other clients and is paid for a result is plausibly a 1099 contractor. A worker who works the hours you set, with your equipment, under your direction, is an employee no matter what the contract says, and the IRS and the state agencies both apply their own tests to that question. Misclassification means back taxes, unpaid unemployment insurance and penalties for the whole period, so the fee difference between running someone as a contractor and running them as an employee is never the deciding factor. Deel is the exception worth knowing about: it sells explicit contractor misclassification cover, which is why it appears here even though its per-employee pricing is built for global teams.
Health cover and the ACA
Below 50 full-time-equivalent employees you are not an Applicable Large Employer, so the ACA's employer mandate and its 1095-C reporting do not apply to you, and you are free to offer health cover or not. Most small businesses offer it anyway to compete for staff, which is where benefits administration earns its place in the ranking: Gusto, OnPay and QuickBooks will run health and retirement deductions through payroll and keep the plan and the pay run in sync. Patriot Software will not, at least not without an add-on, and that is the single most likely reason a business outgrows it. If you are anywhere near the 50 FTE line, check the reporting story before you commit, because crossing it turns a benefits question into a filing obligation.
The verdict
For most US small businesses, Gusto is the pick: full-service filing on every tier, W-2 and 1099 in one system, benefits and workers comp available through its broker service, and no annual contract. Choose Patriot Software if cost is the binding constraint and you do not need benefits administration: it lists $37/mo plus $5/emp/mo, and the calculator shows where that lands against the others at your headcount. Choose OnPay if you want one plan with everything in it, or if you run a nonprofit or a farm. Stay with QuickBooks Payroll if your books are already in QuickBooks Online and you value the native ledger over the price. Look at Deel if you are also hiring outside the US, and at Rippling if you are about to scale past a couple of dozen people. Set your employee count in the calculator above to see what each one would actually charge you. If you are paying just one person, see the best payroll software for one employee, and if you run an S corporation and pay yourself a salary, see the best payroll software for S corps.