The do-it-yourself instinct that inspires us to start businesses can be the same one that prevents us from recognizing when to stop trying to do everything ourselves. Handling payroll is one of those activities that I think small businesses hang onto for longer than they should.

If your end-of-the-year activities include printing out W-2s for your staff and wondering if the numbers will all work out, this may be the right year to let go. The end of the year presents a particularly good time to switch your payroll processing methods since the service can start with a blank slate.

How can you tell if your business should outsource its payroll? Ask yourself the following 10 questions about this past year. If you find yourself answering "yes" to several of them, you will probably want to consider using a payroll service:

• Did your company receive a payroll tax penalty for failing to pay on time or for paying the incorrect amount?
• Did your employees have to remind you to issue payroll?
• Have your employees questioned your payroll calculations?
• Does your payroll consist of both hourly and salaried employees?
• Do you offer multiple payroll deductions for various benefits like health or dental insurance?
• Do you have several new employees that you will be hiring over the year?
• Do you find it difficult to keep track of when you need to pay the various federal or state payroll and unemployment taxes?
• Have you found yourself overpaying into payroll or unemployment tax accounts?
• Have your employees inquired about direct deposit?
• Do you have difficulty tracking accrued vacation time?

When comparing services, pay special attention to how payroll information is communicated. Since this is how you will primarily be communicating with the service, you should be comfortable with not only the communication method but also the staff that will be handling your information. Make sure to get references from companies who work with the same office that you will be handling. They can be a tremendous resource for insights into the quality of the payroll specialists who will be handling your account.

So you are not surprised when the first bill arrives, learn about all the costs associated with handling your payroll. You can be charged for various payroll-related activities including direct deposit, paycheck delivery, and even the initial set-up. These charges can often be negotiated, though, during the signup process.

If you find yourself too busy to keep up with the administrative part of your job, turning your payroll processing over to a third party can be one of the best New Year's resolutions you can make.