When it comes to running payroll for your business, there are no shortages of options out there. There’s also no single approach that works best for all companies of all sizes. However, if you want to maintain control over your company’s funds, gain transparency into the payroll process, and achieve the greatest amount of flexibility and agility, a cloud-based platform approach is tough to beat… particularly if you’re a seasonal business.
In a previous post, we highlighted the benefits of “no-float” payroll and how it empowers you to run your payroll flawlessly in-house without having to pre-fund a payroll tax account (as is the case with outsourced providers.) Today, we’ll focus on another critical benefit – “real-time payroll” – and highlight how you can leverage this powerful feature to fund payroll taxes when it’s most beneficial for your business.
What types of companies benefit from Real-Time Payroll?
A real-time approach is excellent for most organizations, but it's particularly helpful for seasonal businesses. These organizations tend to see spikes in their business - both in revenue and in hiring practices - during certain times of the year.
What are some examples of seasonal businesses that would benefit from real-time payroll?
- Agriculture / Harvest seasons / Commercial fishing: Because crops are grown within certain seasons, and many external factors can affect crops and their seasonality, there is no guarantee of a good harvest. Harvesting also requires a lot of manual labor. Depending on the size and quantity of crops, agricultural businesses rely on seasonal hires and part-time help. Similarly, depending on the states and regulations surrounding fishing, part-time and seasonal hires increase with commercial fishing.
- Lawn Care and Snow Removal: Lawn care and snow removal businesses often work in opposite seasons, especially in the US Northeast and Mid-Atlantic areas. Lawn care services (mowing, trimming, and other yard maintenance) often occur in the late spring, early summer, and the beginning of fall. While snow removal relies more heavily on the amount of snowfall in the region, the businesses often operate as early as October and into late spring. Leaving significant gaps between operating seasons.
- Sporting Events and Facilities: Any entertainment or sporting event that operates in seasons will have similar needs that real-time payroll can solve. Especially live sporting events, stadiums may hire seasonal help to control crowds, maintain fields, and work during events.
- Tax-prep: Tax season is typically from January through April, with some businesses starting as early as October to prepare for Year-End. Busy companies may stay open for longer hours during tax season or provide overtime for those who work after the filing deadline has passed for those who file late. Outside of tax season, businesses may still operate but have limited operations depending on the company.
How do seasonal businesses file payroll taxes?
According to the IRS, part-time and seasonal employees are subject to the same tax withholding rules that apply to other employees. Seasonal employers don't file Form 941s for the quarters they are not operating and not paying wages because there is no tax liability. To inform the IRS that you are a seasonal employer and do not conduct business every quarter of the year; when filing a 941, you must check the box in part 3 labeled "seasonal employer" so the IRS will not inquire about unfiled returns.
What benefits does real-time payroll give seasonal businesses?
- Control of Cash Flow: Real-time payroll allows seasonal businesses to control their cash flow and keep money within arm's reach during slow or off-seasons.
- Freedom to Run Payroll Whenever: Since most seasonal businesses only operate during certain parts of the year, it is critical to be able to run payroll on the business' schedule not one that is dictated to you.
Even if you own and operate a seasonal business, the Greenshades platform delivers value throughout the year. From onboarding new hires to ensuring your seasonal help is paid accurately, completely, and on time, Greenshades helps to transform your payroll processes into a competitive advantage. To learn how we can help, check out our recent "True Cost of Payroll" webinar or book a no-pressure discussion with one of our consultants and learn how we can help address your specific needs.