Advantages of Monthly Payroll Ofrver Quarterly Payroll

Why monthly payroll is more frequently chosen.

Several options exist when it comes to payroll schedule, while some are better for your unique business than others. Comparing the advantages of these options will open your eyes to many advantages and disadvantages. Two common options include monthly payroll and quarterly payroll, with monthly payroll being the most popular of the two.

Quarterly payroll is not ideal for many organizations. Employees typically want to be paid more frequently than every three months. Employers who follow a quarterly payroll schedule may have a difficult time finding new employees and keeping those who are already with the company on board. Most employees require a more regular payment schedule.

In comparison to a quarterly payroll option, monthly payroll has several advantages. Monthly payroll is typically better suited for the majority of employees. It also makes it easier to stay organized when it comes to taxes, as it is easier to stay organized on a monthly basis.
Additionally, a monthly payroll period decreases chances of you not having the money to pay taxes when they are due. By sticking with monthly payroll, it is easier for an employer to ensure they have enough cash on hand to pay all taxes and withholdings for employees based on IRS, state, and local taxing authority requirements.

A quarterly payroll schedule may make it difficult in terms of cash flow and withholding errors. A monthly payroll option is ideal if you do not want to move to a weekly or bi-weekly schedule. Just as many other bills are due on a monthly basis, it makes sense that your payroll follows suit – and you are used to keeping up with a monthly budget for regular expenses.

Although there is no federal law that mandates how frequently employees must be paid, each state does have wage laws. In some states, quarterly payroll is not even an option.