How do I account for fees from a PEO? What category does it go into?

I appreciate you sharing this here in the Community, @mull1. Allow me to share some information on how you can track your employees' paychecks and fees in QuickBooks Online (QBO).

Since you process your payroll from another service provider, you still need to keep track of those paychecks in QuickBooks. Some payroll services let you import paycheck data directly into QBO. However, if they don't have this feature, you can manually track the fees and payments by creating a journal entry. Also, you can seek your accountant's guidance on how to set this up for you. 

First, you'll have to create a tracking account to track your payroll liabilities and expenses. For the expenses, you can select Expense as the account type, then create the following expense accounts:

• Payroll Expenses: Wages
• Payroll Expenses: Taxes

For the liabilities, select Liabilities as the account type, then create the following:

• Payroll Liabilities: Federal Taxes (941/944)
• Payroll Liabilities: Federal Unemployment (940)
• Payroll Liabilities: [State] SUI/ETT
• Payroll Liabilities: [State] PIT/SDI

Next, you can enter the payroll paychecks into QBO as a journal entry. You can follow the steps below for your reference: 

1. Get your employees' payroll paychecks or a payroll report from your payroll service.
2. Click + New, then select Journal Entry.
3. Under the Journal date, enter the paycheck date.
4. If you want to track the paycheck number, enter it in the Journal no. field.
5. Select Payroll Expenses: Wages for the account, then enter the amount as a Debit.
6. For the net wages, you can select the checking account you're paying your employees from, and then enter the amounts as credits.
7. You can add other paycheck information, deductions, and contributions on the next line items.
8. Click Save.

For more detailed steps, you can access this article: Manually enter payroll paychecks in QuickBooks Online.

Another option that you can do is to create a check for the payments so you can track their transactions and expenses. 

Furthermore, once all your paychecks are recorded, you can generate basic financial reports to have an overview of your business finances and customize them to your preferences.

Let us know if you have other questions about tracking your employee's paychecks or other QuickBooks-related queries. The Community is always available and ready to assist. Have a wonderful day!

@mull1 

If the PEO is providing payroll services, they should be giving you the accounting entry for each payroll.