Setting up payroll

The most important aspect of ensuring an accurate payroll is to set up the payroll properly before you run your first payroll. Setting up a payroll involves gathering information about your employees, such as their names, mailing addresses, and Social Security numbers. As an employer, you will need a federal tax ID number and a business bank account for payroll checks and payroll taxes. You will need to determine what benefits you will offer employees, how often you will pay employees (for example, weekly, bi-weekly, or monthly), and the payment method you will use (for example, paper check or direct deposit).

Pro Tip: It is best practice to manage payroll out of a separate checking account from all other operating expenses. That way, you ensure the funds for the payroll taxes remain in the account until you remit payment to the state and federal government.

In the following sections, we will provide you with a checklist of information you need...