Regardless of whether you run a small nonprofit or a global charitable organization, finding payroll software that can help you manage employee and contractor payments can sometimes be challenging. While on the hunt for the best payroll services for nonprofits, look for a provider that offers budget-friendly solutions with essential features such as tax filing and quick payment options. In addition to offering solid client support, the provider should understand your needs as a nonprofit and streamline your payroll processes so you can focus more on running your organization.
To find the optimal nonprofit payroll software, we evaluated 12 solutions and narrowed the list down to our top five recommendations.
- Gusto: Best overall nonprofit payroll software
- QuickBooks Payroll: Best for QuickBooks accounting users
- OnPay: Best for payroll compliance and delegating payroll tasks
- Rippling: Best payroll service for nonprofits that want flexible and automated pay runs
- Patriot Payroll: Best payroll services for small nonprofits needing simple pay processing tools
QuickBooks Payroll is a great option for businesses that have many different types of employees due to its versatility, ease of use, and wide variety of features.
If you need more information before choosing a provider, check out our guide to understanding payroll for nonprofits, where we walk you through everything from unemployment taxes to labor laws.
Payroll Software for Nonprofits Compared
All of the payroll software for nonprofit organizations we reviewed can handle payments for both employees and contractors—although some have separate plans for only paying contract workers. They also offer onboarding tools, employee self-service portals, time tracking, direct deposits, manual checks you print yourself, and unlimited pay runs. Here are some of the key features and each provider’s pricing details.
Looking for something more robust?
If you need a solution that will handle payroll and all your HR functions, consider Justworks. As a PEO, it treats your employees as its own for administrative purposes. Justworks also covers everything from hiring to retiring, handles payroll in multiple states, including assuming tax liability, and generally takes HR worries off your hands. It’s No. 1 on our list of best PEOs for small businesses and, at $59 per employee monthly, is an affordable option. Learn more in our Justworks review.
Gusto: Best Overall Payroll Software for Nonprofits
- No pricing discounts for nonprofits
- Health insurance limited to 37 states
- Time tracking, paid time-off management, next-day direct deposits, and multistate payroll are available only in higher tiers
- Basic plan only comes with single state pay processing
What We Like
Gusto’s excellent tools earned it first place in our guides to the best small business payroll software and the best payroll services, and it’s featured in multiple payroll and HR software lists. Its price point, ease of use, and integration with Aplos nonprofit management software earn it the top spot on this list as well. Its contractor-only payroll plan is a great option if you only work with contract employees. Gusto offers excellent tools for employees too, including Gusto Wallet, which makes it easy to budget, save, and even give to charities.
In our evaluation, Gusto earned an overall score of 4.45 out of 5. It earned high ratings in nearly all our criteria, with perfect marks for popularity and reporting. While Gusto doesn’t currently offer health insurance in all 50 states like OnPay and Rippling, it’s reasonably priced, easy to use, and highly regarded by users.
QuickBooks Payroll: Best for QuickBooks Accounting Users
- Tax penalty protection only in Elite plan
- Local tax filings and time tracking available only in higher tiers
- Limited health benefits coverage (doesn’t include HI, VT, and DC)
- Doesn’t have mobile apps for employee self-service (only offers a workforce portal you can access online)
What We Like
QuickBooks Payroll offers many of the most important pay processing tools that a nonprofit organization needs at a reasonable price. Given that its payroll function can be directly and easily accessed through the QuickBooks system, it saves QuickBooks users time from having to separately set up a chart of accounts and import pay-related data into its platform. With QuickBooks being a household name for accounting software, this is a huge competitive advantage, especially compared to those with very limited integration capabilities, such as Patriot Payroll.
With 4.43 out of 5 in our evaluation, QuickBooks Payroll earned high ratings for pricing, payroll features, ease of use, and reporting. It lost points for not having a pay card option or nonprofit discount and for the limited coverage of its health insurance. User popularity ratings were good but not as high as the others on our list. Overall, real-world users liked the software for ease of use—but said that its setup could take some time, and the support could be problematic at times.
QuickBooks Payroll Overview
OnPay: Best for Payroll Compliance & Delegating Payroll Tasks
What We Like
OnPay’s cloud-based HR payroll platform makes it easy for nonprofit organizations to onboard new hires and pay a wide range of workers—from employees to contractors and volunteers. It can handle multiple pay rates, spot payroll compliance issues, and automatically withholds the applicable federal and state taxes, including federal insurance contribution act (FICA) taxes. And, with its six levels of system permissions, you can choose who has visibility into payroll and HR, allowing you to securely delegate pay processing tasks.
In our evaluation, OnPay earned an overall score of 4.25 out of 5. Its ease of use, efficient HR and payroll tools, reasonably priced plan, and solid reporting functionality contributed to its high scores. While OnPay is highly rated on third-party review sites like G2 and Capterra, with reviewers liking its user-friendly platform, it received a low score in our popularity criterion because its average number of reviews on the websites is below 1,000.
Rippling: Best for Flexible Pay Runs & Payroll Automation
- You have to purchase its core workforce management platform before you can other HR, IT, and finance solutions
- Pricing isn’t fully transparent; you have to call its sales team to discuss your requirements and get a custom quote
- Can get pricey as you add more features
- Getting phone support requires asking for a callback from its chat representatives
What We Like
Rippling takes the stress out of managing pay runs given its robust workflow and automation tools that sync all of your employee and HR data with payroll. This means you don’t have to manually input PTO hours, employee clock-ins/outs, or benefits deductions because the system will capture and calculate this for you. Plus, Rippling is equipped to handle a wide range of payroll services, from employee to contractor payouts and local to international pay runs. Rippling’s EOR services can even help you hire and pay global workers for your nonprofit.
Scoring 4.16 out of 5 in our evaluation, Rippling earned perfect ratings in reporting and user popularity. Its solid payroll and HR features, customizable pricing plan, and ease of use contributed to its high scores. However, it lost several points because of its paid HR advisory services and the non-straightforward way of asking for phone support (this has to be scheduled via its chat representatives).
Patriot Payroll: Best for Small Nonprofits Needing a Simple Payroll Solution
What We Like
Patriot Payroll is the only provider on our list that can suit your needs whether you’re looking for a full-service payroll option or a more affordable DIY version for doing payroll. It’s the simplest on our list, with just the most basic payroll tools. Even the HR add-on is for organization, documentation, and HR reports, whereas Rippling offers more HR tools and Gusto comes with hiring and performance reviews. However, with budgeting being such an important aspect of nonprofit financials, it is a great option for those looking for an affordable solution.
In our evaluation, Patriot Payroll scored a 4.04 out of 5, gaining top points for its budget-friendly software and popularity among users. It lost points for its limited HR features and only offering a four-day direct deposit funding period (the two-day option is only for qualified companies). Many other providers on our guide, such as Gusto, offer two-day funding in their starter tiers.
Patriot Payroll Overview
How We Evaluated the Top Payroll Services for Nonprofits
We compared several of the most popular providers, focusing on features that would be most valuable for nonprofit organizations. We looked for payroll providers that offer unlimited pay runs, flexible direct deposit schedules, seamless integrations with third-party software, and the availability of both basic and customized payroll reports.
Click through the tabs below for a more detailed breakdown of our evaluation criteria.
35% of Overall Score
25% of Overall Score
20% of Overall Score
10% of Overall Score
The best payroll software for nonprofits includes basic HR tools, such as online onboarding, new hire reporting, and employee benefits. Self-service portals that allow your team to manage their information also hold a huge value.
5% of Overall Score
We considered online user reviews, including those of our competitors like G2 and Capterra, based on a 5-star scale, wherein any option with an average of 4-plus stars is ideal. Also, software with 1,000 or more reviews on third-party sites is preferred.
5% of Overall Score
Aside from having access to basic payroll summaries, users should be able to customize reports within the system. Reporting is especially important for nonprofits that need an easy way to determine their payroll costs.
How to Choose the Best Payroll Software for Nonprofits
In selecting the payroll software or payroll services for your nonprofit, consider the following factors:
- Features: It’s important to take a look at the features you need. For pay processing, look for those that can handle multiple pay rates, automatic payroll and tax calculations, and tax filing services. Having access to direct deposit payouts will make employee payments easy for payroll administrators.
- Ease of use and scalability: Look for payroll systems that are simple to set up, learn, and use. If you plan to grow into a large nonprofit organization, consider those that offer scalable payroll solutions that can handle the complex HR payroll processes that come with managing a large workforce.
- Budget: Don’t forget to consider your budget when looking for a payroll system. Be ready to spend more if you want advanced features like learning management, recruiting, or performance reviews.
- Compliance: Check if the provider has the expertise to handle the tax reporting and compliance requirements of nonprofit organizations. Plus, having access to tax payment and filing services can take the stress out of having to do this yourself.
- Support: While having access to 24/7 support is ideal, if this isn’t available, look for those that provide live phone or chat support.
Frequently Asked Questions (FAQs)
Yes. Nonprofit organizations are exempt from federal unemployment taxes and, in some cases, state unemployment taxes. Be sure to check that your payroll software notes this to avoid adding undue expenses and complications.
Payroll service providers make it easy to pay employees, sometimes taking only minutes to complete a pay run. Plus, these providers offer automated checks to make sure you are error-free and in compliance with federal, state, and even local laws.
Yes. You must withhold federal, state, and local income taxes as well as FICA (Social Security and Medicare) taxes from all qualifying employees. The exception to this may be clergy, who are often considered self-employed for calculating FICA and, thus, you may not need to pay this on their behalf.
Yes, because minimum wage applies to all qualified employees. There are some exceptions. Check with the US Department of Labor (DOL) or your state for details. The minimum wage is currently $7.25 an hour or higher if your state or local municipality has its own rate.
Whether you’re looking for a full-service payroll solution or a more DIY approach, it’s important that you find the payroll software with the features you need. Essential functionalities can range from full-service tax filings to quick direct deposits. You also have to consider pricing and whether or not the nonprofit payroll service you’re considering meets your budget.
We found Gusto to be the best payroll software for nonprofits. It offers reasonably priced plans with a contractor-only package that’s optimal for organizations that mostly hire contract workers. Gusto is a crowd favorite among users given its user-friendly platform, solid payroll tools, and multiple direct deposit options. Sign up for a plan today.