I am in the process of hiring my 1st employee and need to know how to categorize that payroll for tax deductions

Can I deduct payroll from my taxable income and if so how do I classify it 

Answer

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First thing to know is that no payroll service integrates with QBSE . Second is you cannot add or edit categories in QBSE to accommodate manual payroll. Third, you need a FEIN for payroll, you cannot pay from your SS#.

Payroll wages plus employer share of taxes is a deductible business expense. You need IRS Schedule E aka Publication 15 easily found at irs.gov and then, even if you do manual payroll rather than paying intuit or another service, you need a different edition of QuickBooks. Or subscribe to online intuit payroll with the understanding up front that your tax returns will have to be manually entered and not just one button export from QBSE to TurboTax 

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