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How To Set Up Payroll In QuickBooks? [A Complete Guide]

QuickBooks is one of the best accounting software because of its features. Payroll is a standout feature in QuickBooks. Additionally, you can pay your employees on time by calculating payroll taxes automatically. It helps you pay your employees, track expenses, and manage books. It also helps you to fill out tax forms, but you need to set up Payroll in QuickBooks.

However, the license or subscription fee does not include payroll. You can use enhanced payroll by paying an additional $50 per month. If you want to add more employees, then you will have to pay $2 monthly per employee.

QuickBooks Payroll offers a 30-day free trial to test its features. Additionally, you will not have to install any other software; you can access the Payroll feature from the dashboard. Let’s get started with the Payroll tool.

Required Information To Set Up Payroll In QuickBooks

Gather all required information and documents to make the setup process as quick as possible. Here is a list of the required information that you need to process and set up payroll. After that, you will get a step-by-step guide to using them.

  1. Signed and completed W-4 for employees.
  2. Pay rates [based on commission, salary, and hourly]
  3. Pay Schedule [Monthly, Bi-weekly, or weekly]
  4. Required details of your employees.
  5. Deductions.
  6. Vacation hours & sick time.
  7. Additions and Compensation.
  8. Direct Deposit Information.
  9. Bank Account Details.
  10. Tax Details.
  11. Payroll subscription details.

Read More:- Quickbooks Won’t Send Emails: How To Solve This Issue?

How To Set Up Payroll In QuickBooks?

Follow these processes to have your payroll up in no time. Additionally, you can use a sample company file for practice. Follow these steps to start the setup process:

Step 1: Launch The QuickBooks Payroll Setup Tool

First, you must collect the required documents and other details. Here are the steps to open the payroll setup:

  • Firstly, go to the Dashboard menu.
  • Locate and tap the Employees window from the top navigation bar.

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  • After that, select Payroll Center from the dropdown window.
  • Wait for a few minutes until a full window opens.
  • Then, locate and select Payroll Setup to continue.

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  • Finally, tap the Continue option.

Step 2: Setup The Compensation

After finishing step 1, you must enter your company information. You can also add compensation and benefits to proceed. You can use the following options for compensation:

 Payroll-In-QuickBooks.

  • Mileage Reimbursement.
  • Bonus.
  • Salary.
  • Regular Pay.
  • Overtime Pay.

QuickBooks allows you to edit or customize the options. You can delete compensation that the company no longer offers. You can add more compensation that is not on the current list. It also allows you to change the account name and account type, make the item inactive or active, and more.

After confirming these entries, you can continue on the next step to set up the Employee Benefits.

Step 3: Set Up Employee Benefits

You can add and set up the employee benefits that your company offers. It also allows you to add pay deductions and additions like Paid time off, Retirement benefits, Insurance benefits, health insurance, Direct deposit, etc.

Go through the steps given below:

  • Go to the Dashboard menu and tap Payroll from the Side Panel.

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  • After that, navigate to the Benefits tab and select the Find My Plan option.
  • Use the Employee Data to choose the best plans.

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  • Then, tap the Start Application option and follow on-screen prompts.
  • Choose a start date for your coverage.
  • Select the coverage and add the employee information. 
  • Upload documents and complete the process.

Step 4: Set Up Your Employees

You will need pay rates and W-4 details to set up your employees. Follow the steps given below to set up your employees:

Personal Details

Here are the steps to add personal details:

  1. First of all, open the Employee List from your dashboard.
  2. After that, click the Add New option.
  3. Enter the employee’s name and address in the required field.
  4. Then, fill out the contact details.
  5. Tap Next to save the details.

You will have to provide Gender, Birthdate, Release date, Hire date, Social security number, Employee type, Contact details, and Legal name information.

Pay Rates & Schedules

quickbooks-desktop-payroll

Here you can enter the employee’s pay rate and schedule. You can add health insurance costs, mileage reimbursement, bonus, and overtime rates. Then, you can follow these steps:

  • Open the Employees menu and choose the Employee Center tab.
  • Then, choose the name and tap on the Edit icon.
  • Go to the Edit Employee window and choose the Payroll Info option.
  • After that, tap on the Arrow icon next to the Payroll Schedule tab.
  • Finally, click Add New to create a new one.

Direct Deposit

Add the direct deposit information if your employee receiveriters@123#

s the pay via this method. Here are the steps to do so:

  • Firstly, click on the Setting menu.
  • Choose the Payroll settings to process.
  • Then, select the Direct Deposit option under the Payroll tab.

quickbooks-payroll-login

  • Locate and tap the Verify Test Transaction option.
  • Moreover, fill out the Transaction Amount in the text field.

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  • Choose Ok to get the verification window.
  • Finally, complete the verification and set up your employees.

State & Federal Tax Details

Go through the steps mentioned below:

  • First of all, fill out the tax information for the employee.
  • Enter credits, withholdings, amount, number of allowances, and filing status.

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  • After that, tap on the Next option.
  • Fill out the same details for the state tax details.
  • Then, save the employee’s information.
  • Open the Employee List and ensure that all the details are correct.

Step 5: Set Up Payroll Taxes

Paying taxes might be difficult for a lot of people. You can make the process smooth by using the QuickBooks Payroll tool. It helps you to calculate taxes, file payroll taxes, and pay them.

Scheduled Payments

Go through these steps to set up the required tax payments:

  • Firstly, navigate to the Schedule Payments section.
  • View the listed payments from the column.
  • Then, locate the Description column.
  • Select the frequency and method of the payments.
  • After that, tap Edit to change the frequency information.
  • Finally, save the changes.

Federal Taxes

Here are the steps to setup federal taxes:

  • Go to the Federal Taxes section.
  • After that, click on the Edit option.
  • Change the tax type from the menu.

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  • Then, edit the liability or expense account from the list.
  • Finally, save the changes before exiting.

State Taxes

Go through the instructions given below:

  • Open the State Taxes window.
  • Then, tap on the Tax that needs the correction.

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  • Select the Next option from the window.
  • After that, make the required changes.
  • Save the changes by tapping Yes.
  • Finally, move to the next section.

Step 6: Enter Year-To-Date Payrolls

You will have to enter the year-to-date payrolls to improve the accuracy of your paychecks and payments. Follow the steps mentioned below:

  • First of all, go to the Year-To-Date Payroll section.
  • Click Continue to proceed further.

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  • Enter the tax withholdings, employee pay, check number, pay period, etc.
  • Fill out the payroll tax payments to continue further in the process.

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  • Then, compare the calculated amount with the total amount.
  • Enter the non-tax payments like health insurance, etc.

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  • Finally, save the changes and calculate the amount.

Step 7: Run Your First Payroll

Here are the steps to finalize the set-up process:

  1. Firstly, select the Finishing Up option.
  2. Select the Go To Payroll Center option.
  3. Then, review your details and ensure that it is correct.
  4. Tap the Finish option to finalize the process.

How To Process Payroll In QuickBooks?

After setting up the QuickBooks payroll, you need to pay your employees. Go through the steps mentioned below-

  1. First of all, make sure the pay schedules are accurate.

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  • Use the Payroll Schedules button to delete, edit, or add a new payroll schedule.
  • Then, select the payroll schedule and choose the Start A Scheduled Payroll option.

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  • Make sure that all the information is correct.
  • After that, click on the Continue option to get a detailed breakdown.

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  • Ensure accuracy and select the Create Paychecks option.
  • You will get a pop-up that displays the number of paychecks.

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  • Finally, tap on the Print Paychecks option.

Conclusion

Running payroll in QuickBooks might be difficult for first-time users. The article will help you if you are new to accounting and payroll. Just make sure to follow the steps in this guide. Then, you will be able to Set Up Payroll In QuickBooks.

You can contact MWJ Consultancy if you face any problems during the setup process. We have a team of professionals to offer you expert assistance. You can contact us to resolve your queries related to QuickBooks, TurboTax, TurboCash, Sage, Xero, Quicken, and other accounting software.

Frequently Asked Questions

Here is how to do it:

  • Firstly, tap the Help option from the top menu bar.
  • Locate and tap the About QuickBooks tab.
  • Then, go to the Setup YTD Amounts window by pressing the Ctrl+Alt+Y keys.
  • Tap Next to get to the Enter Prior Payments section.
  • After that, select the Create Payment option.
  • Fill out the Date and navigate to the Taxes & Liabilities field.
  • Then, enter the amount and select the tax item that you have already paid.
  • Click on the Chart Of Accounts tab and tap the Accounts Affected button.

Finally, tap the Finish option to finalize the process.

Follow these steps:

  • First of all, navigate to the Payroll window.
  • Then, enter the General Information related to the employees.
  • Tap the Add An Employee button and enter the required information.
  • Set up payroll in the Online tool.
  • Locate and select the Run Payroll option.
  • Then, enter the Current Hours details.
  • Review and submit the payroll.
  • Finally, print the reports for reference.

Go through the steps mentioned below:

  • Firstly, launch the QuickBooks Online tool and go to the Payroll window.
  • Click on the Overview option.
  • Then, locate the Get Set Up For Tax Payments And Filings option.
  • Tap Start to proceed further in the process.
  • Then, tap Next to enter your EIN and account details.
  • Click the Next option and confirm your name.
  • Follow on-screen prompts and verify your information via OTP.
  • Then, E-sign your forms and click the Done tab to finalize the process.



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