Creating a payroll item

Hello @williejoes,

Thank you for posting here in the Community. I'm here to help you create the payroll item in QuickBooks Desktop.

I recommend creating an Other Current Asset account and link it to a payroll deduction item named Employee Purchases. You can use the item when processing payroll to deduct the net pay amount.

Here's how:

1. Click Lists at the top menu bar and choose Payroll Item List.
   
2. From the Payroll Item drop-down, click New.
3. Select Custom Setup and hit Next.
4. Enter a name for the deduction and click Next again.
   
5. Follow the on-screen instructions.
6. In the Liability account drop-down, select the Employee Purchases for Other Current Asset.
7. Click Next until it's finished.

To increase sales, you can set up a customer version of the employee and use an invoice. You'll need to set up an Other Charge Type item and link it to that Other Current Asset account. Add it on a Credit Memo for the Customer Name version of the employee and Apply this to the Invoice.

Check out this link for additional guidance on how to create an Other Charge type item: Add, edit, and delete items.

I've also attached an article you can use to make any necessary changes to a payroll item, as well as how to view reports related to the Payroll Item list in QuickBooks: Edit a payroll item.

Drop me a comment below if you have any other questions about handling employee charges. I'll be happy to help you some more.