Payroll Setup

Preview · ~42 min read · from QuickBooks Online Complete 2025

After reading this section, you'll be able to set up payroll in QuickBooks Online by configuring employees, tax withholdings, and payroll items that automatically map to the correct accounts. The chapter covers subscribing to QBO Payroll (with Core, Premium, or Elite options), creating and assigning pay schedules, and specifying benefit deductions and contributions like retirement plans and medical insurance. Understanding how payroll items connect to your chart of accounts is essential because QBO uses these items to automatically calculate taxes, generate tax forms like the W-2 and 941, and create the necessary journal entries as you process paychecks.

In this chapter

• Intuit’s Payroll Subscriptions
• Getting Help With Payroll
• Checklist for Setting Up Payroll
• The Accounting Behind the Scenes
• Payroll Accounts
• Payroll Items
• Subscribing to QBO Payroll
• Adding Employees
• Creating Pay Schedules
• Entering Tax Withholding Information
• Setting Up Direct Deposit
• Wage Options
• Assigning Time Off Policies
• Additional Compensation and Pay Types
• Medical Insurance
• Retirement Plans
• Customizing the Payroll Settings
• Specify the Payroll Accounting Mapping
• The Payroll Overview