Today, QuickBooks is considered as one of the best tools that millions use to elevate their businesses and make their accounting tasks seamless. If you too wish to make the most of this QuickBooks accounting software for your business, then this article is for you. In today’s article, we will talk about set up payroll in QuickBooks for your business enterprise.
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A Brief Overview about QuickBooks Payroll
QuickBooks is packed and loaded with features that helps businesses to balance their books of accounts, monitor the expenses, and pay wages to their staff. It is called as QuickBooks Payroll. With the help of QuickBooks Payroll, your business with be equipped with a swift, seamless, and easy paying procedure for your list of employees without fail on time for all successive periods. Not to mention, it also offers extra helpful functionalities to your business like completing the tax forms and payroll taxes.
However, the cost of your monthly expense or license fee for QuickBooks Desktop does not comprise the payroll. For users, it will be an extra expense to include an add-on QuickBooks Payroll feature. Based on the plan you select, you will be required to pay somewhere between 29 to 109 USD every month along with an extra fee of USD 2 dollars for every employee. But the good part is that you can select a 30-day free trial prior to making any long-term commitment.
Once you complete signing up your subscription form with QuickBooks Payroll, it is possible to navigate through QuickBooks Dashboard seamlessly and you no longer need any kind of download. In this process, it is possible to begin starting up and beginning your payroll in some time.
In today’s article, we will talk about how to set up QuickBooks payroll in a detailed manner to help you accumulate needed documentation to conduct business payroll properly. But first, let us understand first what the elements you require to run in QuickBooks are.
Also Read: How to Set up Payroll in QuickBooks for Mac
What Businesses must Add in QuickBooks?
Before you even begin with accounting software, you must accumulate the required details along with the documents to transform the process of QuickBooks payroll set up easy, quick, and trouble-free. Only after that can you set up QuickBooks Payroll seamlessly.
- Basic Employee Details: Basic details about the employees comprising their birthday, legal name, hire date, address, and termination date.
- Deductions: You must know the kind of deduction along with the number of deductions if your employees possess them. Some known types of paychecks deductions are health insurance premiums, wage garnishments, and retirement accounts.
- Pay Schedule: Mention a particular pay schedule for your particular staff by navigating to the section for How often do you pay employees. Now select the button Create Pay Schedule.
- Form W-4s: You require a full singed W-4s form of every particular employee.
- Pay Rates: Add the employees wage in the particular section for, How much do you pay to your employees? Now add the default number of their particular working hours in a week or in a day.
Setting up Payroll in QuickBooks
Often, for users, it can turn out to be quite confusing for those who wish to set up QuickBooks payroll. That is why we have stated a step-by-step payroll set up to make it effortless for you.
In case you are not sure about running own payroll, you make some trials with the help of sample company to rehearse and take its assistance for guidance.
Here are steps to set up QuickBooks payroll with ease:
Step 1: Open Your QuickBooks Payroll Set up
Once you accumulated all the details, Now you can begin with the first step. The first step is to open the QuickBooks payroll setup tool. Here are the steps to do it:
- Press on the Employee option available on the top bar on your window for QuickBooks.
- Now select the Payroll Center provided in the dropdown menu.
- Now search for Payroll Setup option.
Step 2: Set up Compensation
When the Payroll setup tool is opened, the foremost thing is to add and authenticate data concerning to your business’s benefits and compensation.
There are several option for compensation that your business can thing of using:
- Regular Pay: The amount of money that an employee gets every hour.
- Bonus: For employees, the bonus payments.
- Overtime Rate: Employee payment for working overtime.
- Salary: It is accessed for staff who get a monthly staff.
- Mileage Reimbursement: When you reimburse your employees for the miles driven, it is used.
There are the only three options available in this menu but you can remove any reimbursement type if for any reason your company do not want to utilize it, and also add extra compensation which is on your lists. The best thing is you can select to modify entries and alter what types of compensation are displayed on paychecks. Then choose the account type, and then turn the payroll item active or inactive, along with it modify the account name.
In order to authorize such entries, Press Next. Then move on to the next step.
Get more info: How to Set up Payroll Taxes in QuickBooks Desktop
Step 3: Set Up the Employee Benefits
In the third step, you need to include and change the benefits offered to your employees. You also must add the pay options such as mileage reimbursements and cash advances along with deductions like wage garnishments.
When you have included all the compensation, benefits, and additions, along with deductions, it is high time that you include the number for every employee.
Step 4: Set up the Employees
Do you still recall the information and documents we need you to repair previously? It is time to make the most of it. To set up any employee who is new, press the button for Add New. Now include all that is needed.
In order to set up any new employee, click the button for Add New. Now enter all the needed details such as legal name, gender, birthday, type, hire date, contact information, and employee type.
Schedules and Pay Rates
Now you will be required to enter the pay rates along with the working schedules of the particular employees. Make sure you remember to sell the overtime rates, health insurance costs, bonus, or mileage reimbursement.
The input must also comprise how to determine the sick pay and how many sick pay hours will be permitted, when such hours begin, and what will be the outcome if the sick hours are unused along with the current balances. For the vacation pay, the same process will be levied.
In case your staff gets their pay via direct deposit, in the next step, you need to add the data for direct deposit. For every employee, there will be two accounts which can be set up together as a direct deposit.
To enable your employees to get their direct deposits, you can also offer them prepaid cards via the setup tool. In case you do not select this process, it is possible to pay your staff with a paper check.
State Tax Withholdings
Once the information concerning direct deposit is set, you will be required to a few tax questions like:
- Whether the employee used to work and live in a different state previously.
- State subject to Withholdings
In case you are not sure of this step, or it seems a little confusing, you do not have to worry since QuickBooks has a particular help menu via the setup process. It will for sure make it convenient for users to perform things correctly.
State Tax and Federal Tax detail
For such a section, use the information offered in the form W-4s for employees to add the filing status for every employee, number of allowances, additional withholding amounts, and different credits and credits and withholdings.
Now press Next, the same details for the state must be added.
To finish this section, you will be allowed to save all the important details of your employees and your persistence in maintaining the data can be displayed when you try to search for them. Apart from this, a summary also comes up in the Employee List.
In case there is any information lacking or any error, It will be shown in the Employee List for the users to check and rectify if required. Since, in the Employee List, the summary section can mention the precise error, you do not need to determine it all by yourself and then save a lot of time for other crucial steps.
Step 5: Set Up Payroll Taxes
Paying taxes is a crucial step of a payroll setup. It is possible to make this process less complicated by accessing QuickBooks Desktop to determine and then pay out the payroll taxes.
When the point is about Federal Taxes, you may witness that QuickBooks set up many different taxes such as social security, federal withholding, medicare, federal unemployment, etc.
With the rates of such types of taxes being already set, there will be no requirement for users to think about rates and numbers. But, it is not possible to edit such kind of tax or expense account or modify how it is shown on paychecks. In a majority of the cases, this section does not acknowledge modifications.
In this section, we will talk about State taxes. Regardless of the last stage, you will need to do some edits, however, some state taxes are fixed beforehand for QuickBooks Users, comprising employee disability and state withholding. The present rate will be displayed in the description column.
If you wish to rectify these rates, you need to press on the tab for tax and modify it all by yourself. All that you require is to press Next and make the required changes. Add to it, QuickBooks also offers additional information for those who are not sure of the rates, they can press on the link named Explain. When all the changes are done in the right manner, you need to save the modifications and then press Next.
To set up the needed tax payments, you need to navigate to the Scheduled Payment column. Now you will witness different types of payments that are listed there. In the given description column, the payment frequency can be changed by selecting the Edit option.
Related Article: How to Set up Payroll for Job Costing QuickBooks
Step 6: Input the Year-To-Date Payrolls
If you pay your particular staff for the very first time, then this section is not for you. However, if in case it is not for you, and you have certain employees whose payment has been done in the present year, then you must enter the year-to-date payroll to make sure the tax payments and paychecks are right.
In this section, you will need some time based on the number of employees you need to make payments for and the number of checks that are generated.
Fortunately, QuickBooks offers instructions right on the page, thereby making the tool very seamless to use. This step needs information like a check number, check date, tax withholdings, employee pay, etc. For all those employees who were paid in the present year, their data must be added enough.
Lastly, QuickBooks will do some calculations for the price you need to pay and then differentiate it from the overall amount paid by you already and allow you to check the remaining balance.
Step 7: Complete and Run Your QuickBooks Payroll
Considering you have completed all the steps mentioned above, you can now run the QuickBooks payroll. In case you enter the needed information, then your payroll is ready to use. In such a scenario, it is possible to run your first payroll and modify or make additions if you want to.
Complete and get ready to run the QuickBooks Payroll for the first time
Even when the setup process is quite long, it is quite comprehensive and evident for all users to comprehend how QuickBooks Payroll can be set up with ease. Ensure that you take enough time and put adequate effort to add all the crucial data in a precise way so that the staff can receive the right payment on time and they face no issues concerning taxes later on.
We know that running payroll for the very first time can be quite intriguing, however, after some time you may find it easy, simple, and seamless to use. We hope that the information provided in this article is enough for you to know all there is about QuickBooks Payroll.
Still, if you have any confusion, you can reach out to our Dancing Numbers expert team. Our team has the right knowledge and expertise in handling such technical queries. They have been dealing with such issues for a long time and can be your guide all the way.
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+1-800-596-0806 or chat with experts.
Frequently Asked Questions
Are the Updates for QuickBooks Payroll Crucial?
QuickBooks Payroll software gets an update frequently. Hence, you should not be surprised when you get any notification. Such updates are often significant. They generally comprise the latest changes to regulations and tax forms or security fixes and enhancements to the software.
How to Get a Certified Payroll in QuickBooks?
If you need to finish a certified payroll report, once you completed your normal payroll in the accounting software QuickBooks you can do it with ease with the following steps:
- Navigate to Reports. Then go to Employees and Payroll. Now go to More Payroll Reports in Excel.
- Now click Certified Payroll Report.
- Add all the extra details required when you are notified to issue a certified payroll report.