Why You Should Be Running Payroll (and the Best Options to Do It Right)
If you’re running a real estate business—even a small one with just yourself and a few team members—you may be wondering if you really need to run payroll. For many real estate investors, writing the occasional check or transferring funds via Zelle feels like enough. But if you’re paying others to help run your business—whether it’s a transaction coordinator, general contractor, or even yourself as an S-corp owner—there are some very good reasons to run proper payroll.
Why Payroll Matters
First and foremost, payroll keeps you compliant. If you’re paying W-2 employees or taking distributions from an S-corp, the IRS expects to see consistent, documented payroll with proper tax withholdings. Skipping payroll or doing it informally can trigger penalties, audits, or reclassification of payments. Payroll also helps you establish proof of income, which can be useful when applying for loans or refinancing properties. For S-corp owners who need to show reasonable compensation, running proper payroll is a must.
Beyond compliance, payroll systems simplify your life. They automatically handle tax filings, calculate withholdings, and generate W-2s or 1099s at year-end. Instead of scrambling to gather documents or manually issue payments, everything is taken care of in a streamlined, professional process.
The Best Payroll Options: Gusto and ADP
There are a lot of payroll tools on the market, but two that consistently stand out—both for ease of use and reliability—are Gusto and ADP. I recommend both, and I have affiliate relationships with them—not because of the commission, but because these are the platforms I’ve found to be the most dependable and user-friendly after working with many clients over the years.
- Gusto is great for REIs, small businesses and startups. It’s intuitive, affordable, and includes features like benefits management and contractor payments. The dashboard is clean, and it integrates seamlessly with QuickBooks and other accounting tools.
- ADP is a solid choice for businesses that need more robust HR tools or have more complex payroll needs. It’s a trusted name in payroll for a reason, offering deep functionality and strong support for scaling businesses.
Whichever you choose, both platforms can help you stay on top of compliance, save time, and reduce stress—so you can focus on managing your rentals or finding your next deal.
Final Thoughts
If you’ve been putting off setting up payroll because it feels too complicated or unnecessary, now’s the time to change that. Whether you’re paying employees, contractors, or yourself, running payroll the right way keeps you compliant, organized, and stress-free. I’ve worked with countless clients using both Gusto and ADP, and they’ve consistently proven to be the easiest partners to work with—which is why I confidently recommend them.
Full disclosure: I do have affiliate relationships with Gusto and ADP, which means I may receive a small commission if you sign up through my links. But I only recommend tools I truly believe in, and these are platforms I’ve personally vetted and use regularly in my practice.
