Best Payroll Software for Contractors (1099)
For paying 1099 contractors in the US, Gusto's dedicated contractor plan is the best option: $35/month plus $6 per contractor (promotional $0-base pricing is often available for the first six months), with contractor self-onboarding and 1099 filings handled. Square Payroll's contractor-only plan is the closest alternative, with a $0 monthly base plus a per-contractor fee, and Deel is the right answer once your contractors are outside the United States.
The important structural point is that paying contractors isn't payroll in the tax sense. You're not withholding income tax or paying employer payroll taxes — you're making payments and reporting them, usually on a 1099-NEC. That's why contractor plans can be sold with a $0 base while employee plans can't.
It also means the wrong question is "which payroll software is cheapest for contractors" and the right one is "will I be hiring W-2 employees soon." If the answer is yes, pick a provider you won't have to leave.
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Our ranked picks
We earn a commission from Gusto and OnPay, and nothing from Square, Deel, or Rippling. Ranking reflects documented contractor capability.
- 1Best overall for 1099 contractors
Gusto
US businesses paying contractors who may hire employees later
Gusto's contractor-only plan is $35/month plus $6 per contractor, with promotional $0-base pricing often available for the first six months — confirm current terms before signing up. Contractors onboard themselves, enter their own tax details, and get their 1099s through the same portal, which removes most of the year-end scramble.
It's the best choice when your worker mix might change. Adding your first W-2 employee is a move up to Simple at $49/month plus $6 per person inside the same account, with full-service federal, state, and local filings, rather than a migration to a new provider.
Where it falls short- Promotional contractor pricing changes — verify the current base and per-contractor fee.
- Once you have employees, Simple is single-state only; multi-state requires Plus at $80/month plus $12 per person.
- US-focused: international contractors are better served by Deel.
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- 2Best $0-base alternative
Square Payroll
Contractor-only businesses, especially existing Square users
Square Payroll's contractor-only plan carries a $0 monthly base and charges per contractor paid, with 1099-NEC filings included. In a month where you pay nobody, you pay nothing — which suits seasonal or project-based businesses well.
If you already take payments through Square, this also keeps payouts and reporting in one account. We earn nothing from Square; it's here on the strength of the pricing model.
Where it falls short- Adding a W-2 employee moves you to Square's paid employee plan with a monthly base plus per-employee fee.
- Limited HR and benefits functionality.
- Full-service payroll is $35/month plus $6 per person paid; contractor-only is $6 per person paid with no base fee (pricing verified August 2026).
- 3Best for international contractors
Deel
Businesses paying contractors outside the United States
Deel is built for cross-border work: contractor payments in many countries, localized contract templates, and an EOR product for when you need to hire someone as an employee in a country where you have no entity. Its contractor pricing is a published per-contractor monthly rate.
We earn nothing from Deel. It's ranked here because for international contractors, US-focused payroll tools simply don't solve the problem.
Where it falls short- Overkill and more expensive than a $0-base plan for purely domestic contractors.
- EOR employment is a significantly higher per-person cost than contractor payments.
- Deel is $49 per contractor per month, $599 per employee per month for EOR, $125 per employee per month for US PEO, and $325 per contractor per month for Contractor of Record (pricing verified August 2026).
- 4Best when contractors and employees are mixed
OnPay
Businesses paying both 1099 contractors and W-2 employees
OnPay charges $49/month plus $6 per person and handles both employees and contractors in one flat plan, including W-2 and 1099 filings and multi-state payroll. If you already have employees, adding contractors here costs the same per-person rate rather than requiring a second system.
Unlimited pay runs also help with contractors who invoice irregularly, since there's no per-run penalty for paying someone off-cycle.
Where it falls short- No $0-base contractor-only option: you pay the $49 base even with no employees.
- Not competitive for a business that pays only a couple of contractors.
- US-focused, so international contractors need a different tool.
PayrollSignal may earn a commission if you sign up through this link. It does not affect our ranking.
- 5Best for large mixed and global workforces
Rippling
Companies managing employees, contractors, and global hires at scale
Rippling handles employees, contractors, and international hiring in one platform, with HRIS, app provisioning, and device management alongside payroll. For a company where a contractor might convert to an employee and then relocate, keeping all three in one system avoids constant reconciliation.
This is a platform decision. It pays off with scale and complexity, not with five contractors and a spreadsheet.
Where it falls short- Quote-based modular pricing, with no $0-base contractor option.
- Requires meaningful setup and internal ownership.
- Substantially more platform than a contractor-only business needs.
Compare the picks side by side
| Provider | Starting price | Per person | Best for |
|---|---|---|---|
| Gusto | Contractor Only: $35/mo base | $6 / person / mo | US businesses paying contractors who may hire employees later |
| Square Payroll | $0 base (contractors only) | $6 / person paid / mo | Contractor-only businesses, especially existing Square users |
| Deel | $49 / contractor / mo | EOR: $599 / employee / mo | Businesses paying contractors outside the United States |
| OnPay | $49/mo base | $6 / person / mo | Businesses paying both 1099 contractors and W-2 employees |
| Rippling | Quote-based (payroll price not published) | Quote-based | Companies managing employees, contractors, and global hires at scale |
Prices shown come from each provider's review page on this site. Confirm current pricing with the provider before signing up — payroll pricing changes often.
Pricing verified August 2026
How we picked
For contractor payments we weight the pricing model first, because a $0 monthly base fundamentally changes the economics for a business with irregular contractor activity. A plan that bills only when you pay someone is a different product from one with a fixed monthly floor.
Second, we weight 1099 handling end to end: contractor self-onboarding, W-9 collection, and 1099-NEC filing at year end. Third, whether the provider can absorb your next step — hiring a W-2 employee, or paying someone in another country — without a provider migration.
We do not treat contractor payment tools as payroll tax services, because they aren't. Nothing on this page withholds income tax or pays employer payroll taxes on a contractor's behalf, and any tool that implied otherwise would be a reason for concern, not a feature.
Every provider is scored against the same criteria. Read our payroll software review methodology.
Frequently asked questions
What is the best payroll software for 1099 contractors?
Gusto's contractor plan, which is $35/month plus $6 per contractor (promotional $0-base pricing is often available for the first six months), with contractor self-onboarding and 1099 filings — and lets you move up to Simple at $49/month plus $6 per person when you hire a W-2 employee. Square Payroll's contractor-only plan is the closest alternative, with a $0 monthly base.
Do I need payroll software to pay contractors?
You don't strictly need it, since you're not withholding taxes from contractor payments. But a contractor plan collects W-9 information, tracks payments, and files 1099-NECs for you, which is worth the per-contractor fee once you're paying more than one or two people.
Is paying contractors the same as running payroll?
No. With a 1099 contractor you aren't withholding income tax or paying employer payroll taxes — you're making payments and reporting them, generally on a 1099-NEC. That difference is why contractor plans can be sold with a $0 monthly base while employee payroll can't.
How do I pay contractors in other countries?
Use a platform built for it. Deel supports contractor payments across many countries with localized contracts and offers an EOR product when you need to hire someone as an employee where you have no legal entity. Rippling also supports international hiring as part of its broader platform.
What happens when a contractor becomes an employee?
You move onto an employee plan with tax withholding and full-service filings. That transition is easiest if you're already with a provider that does both: Gusto's contractor plan steps up to Simple at $49/month plus $6 per person, and OnPay handles employees and contractors in one flat $49/month plus $6 per person plan.
The bottom line
If you only pay US contractors, a low-cost contractor plan lets you avoid the monthly floor that employee payroll requires. Square Payroll is the closest to free with a $0 base; Gusto's regular price is $35/month plus $6 per contractor (promotional $0-base pricing is often available). Gusto is the strongest workflow, with Square close behind on price.
If you already have W-2 employees, or expect to soon, the cheaper answer over a year is usually a single provider that handles both. And before classifying anyone as a contractor, make sure the relationship actually qualifies — misclassification is far more expensive than any software decision on this page.
Read how we research and score payroll providers in our payroll software review methodology.