In doing so, you’re creating Payroll Items. Each page poses questions, and you provide answers by entering data and selecting options from drop-down lists. This is a multi-screen, wizard-like tool that walks you through the process of providing information about employees, compensation, benefits and other additions/deductions, and taxes. You can find this tool by going to Employees | Payroll Setup. This element of your accounting is complicated enough that QuickBooks has a separate setup tool to guide you through the myriad details you’ll need to provide. On the left hand side of the Preferences dialogue box that opens, select Payroll & Employees, then click on the Company Preferences tab. Click Edit in the top menu bar to bring up the drop down menu, click on Preferences. You must first make sure that payroll is turned on. That said, we’ll give you a brief preview of how QuickBooks Payroll Items work. Federal, state, and local taxing agencies will count on you to submit the proper payroll taxes and filings on time failure to do so can result in stiff penalties and worse. You’re responsible for your employees’ livelihoods and for maintaining any benefits they’ll receive. It goes without saying that accuracy is critical here. QuickBooks simplifies the actual mechanics of setting up and running payroll, but there’s still a lot you need to know. If you have no experience dealing with paychecks, deductions, and payroll taxes, we strongly recommend that you let us, or someone else with payroll experience, help you get started. But the reward is complete control over your compensation records and transactions, and constant access to your payroll data. Considering processing your own payroll in QuickBooks? Whether you’re moving from a payroll service or getting ready to pay your first employee, you’re taking on a complex set of tasks that requires a great deal of setup and absolute precision.