Learn how to calculate and manage payroll with QuickBooks Paycheck Calculator including gross wages, payroll taxes and benefits.
Calculating paychecks accurately can be a real hassle for small and medium-sized businesses, especially if they’ve recently experienced a good growth rate. With more and more employees coming into your organization, the task becomes herculean. Fortunately, QuickBooks provides a paycheck calculator, if you have the payroll subscription enabled.
Types of Payroll Calculators Are:
- Salary Paycheck Calculator
- Hourly Paycheck Calculator
- Net-to-Gross Paycheck Calculator
Why Need QuickBooks Paycheck Calculator?
QuickBooks payroll calculator enables you to calculate the wages of your employees accurately and within seconds. Along with pay, you can also calculate the with holdings and tax amounts. You can calculate wages for hourly wage earners, freelancers, and salaried employees.
All you need to do is enter your employee’s wage, the rest of the calculation can be left to the payroll calculator, which will create a breakup of the salary and give the deductions needed for Medicare and social security.
Payroll calculator is updated with the most recent federal and state tax information, making it a reliable source for tax preparation. Once you’ve entered the wage, you’ll get information about the taxes that need to be paid and the total amount for taxes.
For Extra pay
You can also enter and calculate the amount to be paid as overtime, commission, and bonus. You can do this for both hourly wage earners and salaried employees.
How to Calculate and Manage QuickBooks Payroll?
Note: You need to go through the federal guidelines if you want to calculate payroll costs for Paycheck Protection Program (PPP).
According to the law, you must pay your employees not only on time but also accurately. Payroll expenses are the largest costs a business has to undertake. Below, you’ll find all the information required to calculate wages, bonuses, commissions, and taxes with the QuickBooks Payroll calculator.
Before we begin talking about payroll, we need to understand what it includes. Here are the three basic components of a payroll:
- Remuneration – The wage that the employer has agreed to pay the employee
- Cuts – All employees must make social security and medicare contributions from their payroll.
- Unemployment Taxes – Depending on the jurisdiction, the employee must contribute via unemployment taxes.
- Benefits – All of the benefits paid by the employer to the employee is included in the payroll.
Further, at the year end, appropriate amounts of state and federal income taxes are to be deducted from an employee’s wages. The employer must make sure that these taxes are paid accurately and timely.
To calculate payroll, you have the following options:
- Hire a certified accountant who will do all the work for you
- Use an online service like Intuit’s Online Payroll
- Use a Software Like QuickBooks Payroll
- Use free services like Paycheck Calculator
With QuickBooks Payroll, you get the following benefits in relation to calculating paychecks:
- Automated Payroll Process – Paychecks will be automatically calculated and information about deductions will be available.
- Direct Deposit – You can set up direct deposit in order to send wages directly into an employee’s bank account.
- Connect to Experts – You can connect to Mammoth HR advisors who’ll inform you about best practices.
- Reporting – Payroll is an expense, and thus must be minimized. With reporting, you can gather insights on the basis of which you can make future business decisions.
Prerequisites for Setting up Payroll
Settings up payroll require a lot of information. You must ensure the accuracy of this information on your own. If the information you entered is wrong, then the calculated payroll, including deductions for social security and taxes will also be wrong.
Before you set up payroll in QuickBooks, you need the following:
- Information Related to Company – Company’s bank account
- Employee Information
- Form W-4 for each employee
- Pay Rate
- Pay Schedule
- Hiring and Termination Dates
- Direct Deposit Information – If you want to deposit wages into the bank account of your employees, then you’ll require this information
- Tax Information
- Electronic Federal Tax Payment System (EFTPS) enrollment
- Federal Employer Identification Number (FEIN)
- State Agency ID
- Other Tax Information
- Prior Payroll information – If you’ve already paid employees for the current calendar year, then you’ll have to enter that information manually into QuickBooks Payroll
- Liability Information
After gathering the information, you’re all set up to configure payroll in QuickBooks desktop, mac, or online. The payroll subscription can be enabled in all versions of the software. Further, you can get a separate Intuit payroll service, if you don’t want to use am accounting software.
Setting up payroll is easy. QuickBooks Payroll provides a setup wizard which will assist you with the whole process. Here’s how you can get to this wizard:
- Start QuickBooks Payroll
- Go to the Employees tab from the Top Menu
- Click on Payroll Setup
- Follow the instructions provided by the Payroll Setup Wizard
Once you’ve started the process, the setup wizard will prompt you for all the required information. After entering all the information, you can easily automate the payroll process.
Note: If you plan to enable direct deposit for employees, then you must submit Payroll Direct Deposit authorization form for each of them. You can download a copy of the same from the internet or from the payroll software itself.
Payroll is essential for every business. Managing a small or medium sized company without good payroll software can be unfeasible. In order to get accurate paychecks and deductions, you can rely on an all encompassing solution like QuickBooks Payroll.