Our picks · 2027
Best payroll for paying contractors
Ways to pay 1099 contractors and file their 1099-NECs without paying for a full employee payroll plan.
AWBy Austin Witherow · Updated Nov 12, 2026 · 6 min read · How we review
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Quick answer
- Best overall: Square Payroll, square sellers and contractor-only payroll (from $35/mo)
- #2: QuickBooks Payroll, businesses already using quickbooks online (from $50/mo)
- #3: Gusto, growing teams that want room to add states and benefits (from $49/mo)
Compared
Payroll services compared (USD, checked Nov 12, 2026)| Payroll service | Best for | Starts at | Our score | Link |
|---|
| Square Payroll | Square sellers and contractor-only payroll | $35/mo | 8.4 | Visit |
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| QuickBooks Payroll | Businesses already using QuickBooks Online | $50/mo | 8.0 | Visit |
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| Gusto | Growing teams that want room to add states and benefits | $49/mo | 8.9 | Visit |
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| Patriot Payroll | The lowest price for full-service payroll | $37/mo | 8.7 | Visit |
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Square Payroll
Square sellers and contractor-only payroll8.4/10Very goodSquare Payroll is $35/mo + $6 per person paid, files federal and state taxes in all 50 states and DC, and has a $6-per-contractor plan with no base fee. Some local taxes in Ohio, Pennsylvania and New York are left for you to file.
$35/mo + $6 per person paid
Pros
- $35/mo base, the lowest of the payroll plans we compare
- Contractor-only plan: $6 per contractor paid, no base fee
- Federal and state filing in every state; month to month
- Timecards flow in from Square POS
Cons
- Some local taxes are calculated but left for you to file
- Can't pay one employee across several tax jurisdictions
- Mailed paper W-2s and 1099s cost $3 each
- No free trial listed
QuickBooks Payroll
Businesses already using QuickBooks Online8.0/10Very goodQuickBooks Payroll (now sold as QuickBooks Workforce) starts at $50/mo + $7 per employee at the regular price, with next-day deposit. The entry plan files federal and state taxes but not local ones, and each extra state is $12/mo.
$50/mo + $7 per employee (regular price)
Pros
- Next-day direct deposit on the entry plan; same-day on Premium and Elite
- Contractor plan: $25/mo for up to 20 contractors
- Works on its own or inside QuickBooks Online
- Month to month, no annual contract
Cons
- Entry plan doesn't file local taxes
- 50% promo covers the base fee for 3 months only
- Each extra state is $12/mo on Payroll and Premium
- $25,000 tax penalty protection is Elite only
Gusto
Growing teams that want room to add states and benefits8.9/10Very goodGusto files federal, state and local payroll taxes on every plan, month to month. Simple ($49 + $6 per person) covers one state; Plus ($80 + $12) adds multi-state payroll, next-day deposit and time tracking. Many extras are paid add-ons.
$49/mo + $6 per person (Simple)
Pros
- Federal, state and local tax filing on every plan
- Published prices for every plan and add-on
- Unlimited pay runs; month to month, cancel anytime
- Contractors billed only in months you pay them
Cons
- Simple covers one state; multi-state needs Plus at $80 + $12 per person
- Next-day deposit is a $15/mo + $3 per person add-on on Simple
- Priority phone and chat support costs extra below Premium
- Trustpilot score is 3.3/5
Patriot Payroll
The lowest price for full-service payroll8.7/10Very goodPatriot Full Service is $37/mo + $5 per worker at its regular price and files federal, state and most local taxes, with W-2s and 1099s included. The cheaper Basic plan does not file taxes. Advertised prices are a 3-month 50% promo.
$37/mo + $5 per worker (Full Service, regular price)
Pros
- Lowest regular full-service price per worker we found
- Year-end forms (940, 941, W-2, W-3) and 1099 e-filing included on Full Service
- 30-day free trial
- 4.7/5 on Trustpilot from 3,459 reviews
Cons
- Advertised price is 50% off for 3 months; then it doubles
- Each extra state is $12/mo
- Basic Payroll calculates taxes but doesn't file or pay them
- Covers 'most' local taxes; excluded localities aren't listed
How we picked for contractor payroll
If everyone you pay is a 1099 contractor, a full employee payroll plan charges you for tax filing you may not use. We looked for the lowest cost to pay contractors and file their 1099-NECs, based on each provider's pricing pages and help docs, checked November 12, 2026.
Why each pick fits
Square Payroll
Square has a contractor-only plan at $6 per contractor paid per month, with no base fee (Square payroll). Square generates, prepares and files Form 1099-NEC for you, and pay runs are unlimited. With three contractors you pay $18 a month. The plan includes no tax payments or filings beyond the 1099-NEC and no multi-state payroll, so you move to full-service ($35/mo + $6 per person) once you hire an employee.
QuickBooks Payroll
QuickBooks sells Contractor Payments at $25/mo for up to 20 contractors, plus $2 for each one after that (QuickBooks contractor payments). It includes unlimited 1099-MISC and 1099-NEC e-filing. That flat fee beats Square from five contractors up: at 5 Square is $30 and QuickBooks $25, and at 20 it is $120 against $25. The price is 50% off for the first 3 months, then $25. Next-day deposit for contractors costs extra.
Gusto
Gusto has no contractor-only plan. It bills US contractors at the plan's per-person rate ($6 on Simple), only in months you pay them, and files W-2s and 1099s (Gusto pricing). That suits a business with a few employees plus freelancers who work some months and not others.
Patriot Payroll
Patriot also has no contractor-only plan. Contractors are paid inside payroll and count toward the per-worker fee (Patriot pricing). On Basic Payroll ($17/mo + $4 per worker), 1099 e-filing costs $20 for up to 5 forms, then $2 each, capped at $80 (Patriot 1099 e-file). On Full Service ($37/mo + $5 per worker), 1099 e-filing is free.
What to check before you pick
Check whether the 1099-NEC filing is included or priced per form. Square and QuickBooks include it on their contractor plans. Patriot Basic charges for it once a year.
Check how the fee counts contractors. Square charges per contractor paid, so a month with no payments costs nothing. QuickBooks charges $25 whether you pay 1 contractor or 20. Gusto bills contractors only in months you pay them.
Check what happens when you hire your first employee. Square's contractor plan has no tax filings, so you switch to full-service. QuickBooks' employee plans start at $50/mo + $7 per employee, and the entry plan files federal and state taxes but not local ones.
| Contractors paid each month |
3 |
10 |
20 |
| Square contractor-only |
$18 |
$60 |
$120 |
| QuickBooks Contractor Payments |
$25 |
$25 |
$25 |
| Patriot Basic, monthly |
$29 |
$57 |
$97 |
| Patriot Basic, 1099 e-filing (once a year) |
$20 |
$30 |
$50 |
Prices are regular monthly prices from each vendor's page. Gusto doesn't publish a contractor-only price, so it isn't in the table.
Common questions
What is the cheapest way to pay 1099 contractors?
For one to four contractors, Square's $6 per contractor paid costs less. From five contractors up to 20, QuickBooks Contractor Payments at a flat $25/mo costs less.
Does Square Payroll file 1099-NEC forms for contractors?
Yes. The contractor-only plan files Form 1099-NEC for you. It doesn't make any other tax payments or filings.
Can I pay contractors and employees in the same payroll?
Yes, on Gusto, Patriot and Square full-service. Gusto bills contractors at the plan's per-person rate in months you pay them, and Patriot counts them toward the per-worker fee.