Most small businesses buy accounting software first and meet payroll later, when they hire. The question then is whether to add the accounting vendor's payroll or keep payroll separate. This post compares the three accounting products small US businesses most often start on, using each company's own pricing pages, and lists what you would have to do by hand without a bundle.
We haven't run payroll on these products. Everything here comes from each company's own public pages, read on 8 October 2026, and prices change: check the live page before you sign up.
What a bundle actually adds
The bundle's main job is the journal entry. Every payroll creates the same accounting entries: gross wages as an expense, employer taxes as an expense, withheld taxes and net pay as amounts owed until they're paid. Built-in payroll posts those for you. Separate payroll means you post them yourself or import a report.
It doesn't change what you owe. Publication 15 (2026) still sets the deposits, Form 941 and W-2s, and tells you to keep employment tax records for at least 4 years. Whether you file them yourself depends on the payroll plan, not on where the books live.
What a payroll register is, and why your accountant asks for it
QuickBooks, Xero and Wave with payroll compared
| QuickBooks Online + Workforce Payroll | Xero + Xero Payroll (Gusto) | Wave + Wave Payroll | |
|---|---|---|---|
| Entry accounting plan | Simple Start, in the bundle | Early, $27 a month | Starter, $0 |
| Payroll price | Bundle $88 + $7 per employee | $36 + $6 per employee or contractor | $40 + $6 per active employee |
| Accounting + payroll, 2 employees | $102 | $75 | $52 |
| Payroll taxes filed for you | Yes, federal and state | Yes, says it calculates and files | Yes, in all 50 states (not 1099s) |
| Introductory offer | 50% off the base price for 3 months | 80% off the accounting plan for 3 months (not add-ons) | 30-day payroll trial |
Checked October 8, 2026. From quickbooks.intuit.com, xero.com/us and waveapps.com, read 8 October 2026. Totals are arithmetic on list prices before offers. Wave's Pro accounting plan is $190 a year if you need bank imports.
QuickBooks also sells payroll on its own: Workforce Payroll at $50 a month plus $7 per employee. Its offer terms say the 50% discount applies to the monthly base price for the first 3 months and not to per-employee, per-contractor or state tax filing fees. Higher bundles are $135 plus $7 (with Essentials) and $228 plus $13 (Workforce Premium with Plus).
What to check before you add payroll to your books
- Contractors: Xero's add-on counts each employee or contractor at $6, Wave charges $6 per independent contractor paid, and QuickBooks' discount excludes per-contractor fees.
- States: Wave says its tax service has covered all 50 states since 2 April 2025, so the price is the same in every state. Check that any provider files in each state where you have staff.
- Deposit speed: QuickBooks lists next-day direct deposit on Workforce Payroll and same-day only on Premium and Elite.
- Time tracking: on QuickBooks it comes with Premium and Elite, not the entry payroll plan.
- The price after the offer: QuickBooks, Xero and Wave all lead with a discount or trial. Budget on the list price, which is what the comparison above uses.
When separate tools make more sense
- Your accountant already keeps your books in a product you don't log into. Payroll is then the only tool you touch, and a payroll-only plan is enough.
- You have one employee on a fixed salary. The journal entry is the same every period; typing it in takes minutes, so the bundle saves little.
- Your accounting product's payroll doesn't cover what you need, such as a second state or time tracking, and adding it costs more than a separate plan.
- You use free accounting. Wave's Starter plan is $0, so its payroll add-on is the whole bill.
Do you need accounting software with payroll if you have one employee?
Not necessarily. With one employee you can run payroll yourself, record each payday in whatever books you keep, and hold a payroll register as the record. What you can't skip is the work itself: withholding, deposits on your schedule, Form 941 each quarter, Form 940 for the year and the employee's W-2.
- Work out the paycheck and keep a pay stub that shows each line.
- Record gross pay, employer taxes and net pay in your books, and the withheld taxes as owed.
- Make the deposit and clear the amount owed when it's paid.
- At quarter end, check the register totals against Form 941 before you file it.
Where PayDocs fits
PayDocs isn't accounting or payroll software. If you keep payroll outside your books, it makes the pay stub for each period from your figures, with year-to-date totals that match your register. PayDocs works out federal income tax, Social Security, Medicare and supported state taxes for 2026 pay dates (see what we calculate). Previewing is free; a PDF is $4.99 per pay stub once checkout opens, less in packs of 4 or 12.
This is general information about US federal rules for employers as of 8 October 2026, not tax or legal advice. State and local rules can add to it.
Questions
Which accounting software with payroll costs least?
Of the three compared on 8 October 2026, Wave was lowest: free Starter accounting plus payroll at $40 a month and $6 per active employee. Xero's Early plan plus its Gusto-powered payroll came to $63 plus $6 per person.
Does Xero do payroll in the US?
Yes, as an add-on. Xero's US pricing page lists Xero Payroll, powered by Gusto, at $36 a month plus $6 per employee or contractor on every plan. Its 80% introductory discount doesn't apply to add-ons.
Can I buy QuickBooks Payroll without QuickBooks accounting?
Yes. QuickBooks lists payroll-only plans: Workforce Payroll at $50 a month plus $7 per employee, Premium at $88 plus $13 and Elite at $134 plus $17, before the introductory discount.
Does Wave payroll file taxes in every state?
Wave says its tax service has covered all 50 US states since 2 April 2025, at the same price in every state. It files federal and state payroll taxes but not 1099 forms.
Do you need accounting software with payroll if you have one employee?
Not necessarily. You can run payroll yourself and record each payday in your books. The deposits, Form 941, Form 940 and W-2 still have to be done, and records kept for at least 4 years.
Sources
- QuickBooks: Payroll and accounting bundles (checked 8 October 2026)
- QuickBooks: Payroll-only plans and offer terms (checked 8 October 2026)
- Xero US: Pricing plans (checked 8 October 2026)
- Wave: Pricing (checked 8 October 2026)
- Wave: Payroll (checked 8 October 2026)
- IRS: Publication 15 (2026), Employer's Tax Guide
Sources checked October 8, 2026. This article explains how pay documents work; it is not tax or legal advice.
