How it runs for marketing agencies and consultancies
You approve every run. We keep contractors in accounts payable with a W-9 so worker classification stays clean and 1099 reporting stays separate.
What is payroll processing outsourcing?
Payroll processing outsourcing means a remote team prepares each pay run inside your payroll software: reconciling hours, entering changes, checking deductions and producing the run for the employer to approve. The employer keeps the payroll account, the bank authority and the legal responsibility. The provider posts the payroll journal and reconciles it, so payroll and the books agree.
What we handle for marketing agencies and consultancies
- Prepare each payroll run from approved hours and commission schedules
- Post payroll journals by department, and by client where billed
- Keep contractors in AP with W-9s, never on the payroll file
- Reconcile payroll tax liabilities and benefit deductions monthly
- Track PTO accruals and bonus provisions so month-end costs are complete
The KPI that matters here
Payroll journal posted and reconciled to the payroll provider report within 2 business days of each run.
Agencies compliance notes
1099 contractor reporting
Agencies rely on freelancers, and the IRS requires Form 1099-NEC for nonemployee compensation above the annual threshold, which is $2,000 for payments made in 2026. We collect W-9s at vendor setup, code every contractor payment, and hand your preparer a reconciled 1099 report each January. Your firm reviews and files; we do not sign.
Retainers and deferred revenue
A retainer billed before the service period is a liability until the work is delivered. We keep a deferred revenue schedule that releases each retainer to income as hours are logged or the month ends, so your P&L matches the work actually performed.
WIP and unbilled revenue
Work delivered but not yet invoiced is an asset that lenders and buyers ask about. We reconcile unbilled hours from Harvest or your PM tool against the ledger monthly, so WIP is real, aged and collectible.
Gross versus net for media
ASC 606 and IFRS 15 ask whether the agency is principal or agent for media it buys on a client's behalf. We apply the treatment your CPA or accountant chooses and keep the pass-through account reconciled to platform statements so the answer is documented.
Agencies software we work in
More for marketing agencies and consultancies
Other services for agencies
Payroll support in other industries
Frequently asked questions
Do you run payroll or just the bookkeeping side?
We prepare the run in your payroll platform from approved data and you approve and release it, so the money movement stays with you. After each run we post the journal, reconcile the liabilities and check that tax payments cleared. Gusto, ADP, Paychex and QuickBooks Payroll are the platforms we see most often at agencies.
How do you keep freelancers separate from employees?
Freelancers are set up as vendors in accounts payable with a W-9 on file and are paid through Bill.com or your bank, never through payroll. Their costs are coded to client jobs rather than to salaries. This keeps 1099-NEC reporting separate from W-2 reporting and gives your CPA a clean answer on worker classification.
Can payroll cost be allocated to clients?
Yes, where you track time by client we allocate salaried cost using hours from Harvest or your PM tool, posting the split with classes or tracking categories. This turns the payroll journal into a direct labor cost by account, which is the missing piece in most agency profitability reports.
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