How to set up my payroll?

Part of being an S-Corp means taking a salary as an employee of your business of one. Follow these steps to set up your payroll account with Formations so you can start running payroll.

Step 1: Navigate to Payroll and accept the terms of service

Formations is using Gusto Embedded Payroll as the underlying technology partner to process and manage your payroll. Before you can start your payroll onboarding, you need to accept the terms of service of Gusto.

You can learn more about Gusto Embedded Payroll here and read this blog post to learn why we chose Gusto as our payroll partner.

Step 2: Connect Your Business Bank Account

For payroll to run, you need two bank accounts connected: one to pay yourself from - your business bank accounts - and one to pay yourself to - your personal bank account. In this step, you will connect the business bank account you want to use for paying the salary. Click on the Connect with Plaid button to initiate the connection flow and follow the steps on the screen. You will need to complete several security screens to make sure your account is protected.

Step 3: Review and Confirm Your Information

Once your business bank account is connected, you will need to review the company information (the employer), your personal information (the employee), your direct deposit information (where the salary will be deposited, as well as a final confirmation of your business bank account (where the salary will be paid from). The information presented on this screen is the information you gave Formations during your account setup and onboarding. If you see any errors with this information, you can update it in your business or personal profiles or reach out to us via chat or a ticket.

Step 4: Sign Direct Deposit Authorization and Form 8655

The final step in the payroll setup is to sign two documents that allow Formations to deposit the salary into your personal bank account and pay and file federal taxes on your behalf. You need to click on each document and e-sign each document.

Final Step: Wait for Confirmation and Finalize Your Payroll Plan

After you complete all the steps in the payroll setup, the system will process the information and verify the connection to your business bank account. In the meantime, you can connect with your success team to finalize your payroll plan so you can start taking salary as soon as your accounts are authorized.