Medical & Dental Payroll: The 2025 Compliance Guide (W-2/1099, Locums, Multi-Location)
- Staff on W-2; use 1099 only for true locum/contractor work.
- Multi-location/provider tags keep reporting clean across clinics.
- Pre-/post-tax deductions (HSA/FSA/401(k)) handled with exports.
- We run payroll, file federal/state taxes, and e-deliver W-2/1099.
- Flat pricing: $50 + $7/emp (Full) or $40 + $6 (Basic); +$10/month per extra state.
- Typical onboarding: 5-7 business days after data handoff.
Healthcare payroll has moving parts-providers paid across locations, locums on short assignments, shift differentials, and complex deductions. This guide shows how to structure medical and dental payroll so it’s compliant, auditable, and painless to run every pay period.
Classification: Employees vs Contractors (Locums)
W-2 employees (most roles)
Front desk, assistants, hygienists, RNs, MAs, and most provider roles with regular schedules belong on W-2.
1099 contractors / locum tenens
Use 1099 for independent engagements with control over work and hours. We generate 1099 e-delivery at year-end and keep vendor records tidy.
Mixed models
If a provider toggles between staff and locum work, tag assignments by entity/location so year-end reporting stays accurate.
Pay Schedules, Differentials, and Overtime
- Supports weekly/bi-weekly/semi-monthly/monthly schedules.
- Track shift differentials, on-call stipends, and weekend premiums.
- AI checks flag outlier hours/rates before each run.
Benefits, Deductions, and Garnishments
- Pre-/post-tax deduction exports for HSA, FSA, 401(k).
- PTO accrual tracking; leave categories supported.
- Garnishment handling with audit-ready logs.
Multi-Location & Multi-State Practices
- Tag by clinic, department, provider group, or region.
- Add new states for a flat $10/month each; we remind you about registrations/SUI.
- Consolidated or location-level reporting-your choice.
Time-Tracking & System Integrations
- Imports from common time-tracking tools; exports to accounting/BI.
- Provider/location tags flow through to your reports.
Taxes, Filings, and Year-End
- Federal and state filings included (940/941, SUI, withholding).
- W-2 for staff and 1099 for contractors with e-delivery (paper optional).
- Quarter-end tie-outs and year-end pre-flight validations reduce reprints.
AI-Assisted Accuracy (Before Every Run)
- Flags unusual totals, new-hire gaps, or missing state IDs.
- Differential sanity checks (nights/weekends).
- Year-end W-2/1099 validation so December is quiet.
Pricing & Timeline
- Full Payroll (CPA-reviewed): $50/month base + $7 per employee.
- Basic Payroll: $40 + $6.
- Extra states: $10/month each.
- Most practices go live in 5-7 business days after data handoff.
Quick Setup Checklist
- Staff/contractor roster with pay rates/schedules
- Banking + tax accounts; existing state IDs
- Prior quarter returns and year-to-date totals
- Deductions/benefits list (HSA/FSA/401(k), PTO rules)
- Location/provider tags for reporting
Looking for payroll services tailored to your location?
Our payroll processing services by location offer flat-rate pricing and compliance across all 50 states, including city-specific tax filings and support for remote teams.
FAQs
Do you support 1099 locums?
Yes-1099 e-delivery included.
Can we tag by clinic/provider?
Yes-clean reporting across locations.
Are there per-run fees?
No-flat monthly pricing.
Do you file federal and state payroll taxes?
Yes.
How fast can we start?
Typically 5-7 business days after data handoff.
Need reliable payroll management? Our payroll processing services make it easy to handle taxes, payments, and filings-so you can focus on your business.
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Our plans start at $40/month base + $6 per employee/month, with no per-run fees. Get your first month of bookkeeping free when you sign up.
See Pricing.
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