Anyone using one of the online payroll services to pay their employees and to keep the payroll taxes straight?

I'm looking at www.paycycle.com and it seems very economical and trouble free, but I'm just about as newbie as newbie can be when it comes to payroll/taxes/etc so is there any caveats to this?

If anyone is using these sort of services and has experience with them I'd really like to hear about it, thanks!

Gary,
Something VERY important to keep in mind in regards to payroll services. I am not familiar with the one you mentioned, however, be sure they are reputable and financially stable.

If your payroll service deducts the taxes from your paychecks or collects from you tax money to be paid the the federal, state and city governments and they don't pay, you are still liable.

I know of someone who paid tens of thousands of $ in tax money to their payroll company, the co went out of business and he still owed the government the money.

There are good ones out there, just be careful who you are dealing with, especially when it comes to Internet based companies. I know that sounds hypocritical being an Internet company ourselves, but it is easier to deceive if you are somewhere in the ether vs down the street.

We use a national company and I also ask for copies of receipts from the fed and state.

Using a payroll company can make life much easier as the weekly, monthly and quarterly reports can be a pain. Just do your due diligence and make sure they are doing what they promise.

Eww yeah that would hurt the bottom line for sure getting stuck holding the bag like that.

Edit:

Reading in their faq they say this:

PayCycle calculates your employee's withheld taxes based on the information you provide, so you needn't worry about what to withhold. However, we do not collect your tax liability; you make your own payments. All monies withheld remain in your control until you make your payments.

So that means I actually pay it they just tell me what to send in? So that should at least minimize the amount of my cash they have.

I guess the other caveats are accuracy would hate to underpay all year and get whacked in April.

Why not just let Quickbooks or MYOB do it for you? That's what we do. Though I see those ADP Payroll brochures every time I go into Staples, I'd bet they're expensive. There's also Paychex, though I don't know how 'small' they will go.

Brandon

This company I was lookin at does it for $19.95 a month for up to 5 employees and $.99 per employee after that, seems pretty reasonable. Besides I don't have quickbooks ;)