How to Pay and Manage Contractors and Employees at Collective

My team is where you manage everyone you pay. Employees and contractors each have their own tab, new team members enter their own details through an email invitation, and you can pay contractors or update anyone's information without leaving the page. Recording every payment here keeps each person's payment history accurate and their year-end tax form (a W-2 for employees or a 1099-NEC for contractors) correct.

Paying employees and contractors through Collective Payroll is part of the S Corp tier membership. If you're on the LLC tier, you can still work with contractors and pay them however you prefer (Zelle, PayPal, Venmo, check, and so on). We recommend paying contractors from your business checking account to keep your bookkeeping clean. For more on contractor requirements and tax forms, see Understanding Independent Contractors.

Collective Payroll supports U.S.-based employees and contractors only. For international contractors, use an external payment platform.

Add an employee

1. Go to Payroll, then My team.
2. On the W-2 Employees tab, click Add employee.
3. Enter their first and last name, email, work address (or Works from home), start date, job title (optional), pay type, annual salary or hourly rate, and employee classification. The work address sets up the right state and local taxes.
4. Click Send invitation.

Add a contractor

1. Go to Payroll, then My team.
2. On the 1099 Contractors tab, click Add Contractor.
3. Enter their contractor type (individual or business), email, name, wage type and rate, start date, and work state, and choose whether to file a new-hire report.
4. Click Send invitation.

Each new team member gets an email to enter their own details, such as their Social Security number, address, and bank information, so you don't need to collect them. Once they finish, review their details in My team and confirm them. They can't be paid until you confirm them. If someone hasn't received their invitation, ask them to check their spam folder.

Update someone's details

Every person on your team has a details page with everything in one place.

1. Go to Payroll, then My team.
2. Click the three-dot menu at the end of their row and select View details.
3. Open the tab you need: Profile (personal details and addresses), Compensation (job title, wage, and deductions), Taxes (federal and state withholding), Payment (payment method, bank account, and paystubs), or Documents (forms like their W-4).

Pay contractors

1. Go to Payroll, then My team, and open the 1099 Contractors tab.
2. Click Pay Contractors.
3. On the Contractor payments page, click Create contractor payment, choose who to pay, and enter the payment details. Click Review and submit payroll, then Confirm and pay.

You can also click Pay Contractor in the Quick actions card on the Overview page. Only contractors who have finished onboarding can be paid. Record every payment to a U.S.-based contractor, including ones made outside Collective by check, Zelle, or another method, so their 1099-NEC is accurate. Each contractor's row shows their pay year to date and when they were last paid, and the Contractor payments page lists upcoming and past payments, with receipts.

Pay employees

Employees on your team are included in your regular payroll, so you pay them the same way you pay yourself: go to Payroll, then Overview, click Review and run on your next payroll card, then Submit payroll. To pay someone outside your regular schedule, click Run off-cycle payroll on the W-2 Employees tab or in the Quick actions card on the Overview page. For more, see Running Payroll at Collective.

Payment timing

• Submit payments before 4 PM Pacific Time on a business day.
• Weekends and holidays extend the processing timeline.
• Start from the date you want the deposit to arrive and work backward, so the withdrawal date lines up with your cash flow.

Year-end tax forms

If your employees and contractors are onboarded and paid through Collective Payroll, and any outside payments are recorded before December 30, their year-end tax forms should be ready for you to share with them ahead of the January 31 IRS deadline. Employees receive a W-2, and contractors receive a 1099-NEC.

Next steps

For a quick tour of the dashboard, see Your Payroll Dashboard at a Glance. If you have questions specific to your business, reach out to your Collective team. They're here to help.

Does your dashboard look different?

Features and layouts can vary by account and change over time. If something in this article doesn't match what you see, reach out to your Collective team and they'll point you to the right place.

Disclaimer: This content is for informational purposes only and is not legal, financial, or tax advice. Deadlines listed reflect Collective's operational requirements to ensure timely delivery of services. Failure to meet these deadlines may result in delays to your tax filings and IRS penalties and interest, for which Collective is not responsible.