QuickBooks Payroll Setup Error 05396 40000 typically occurs when there are issues with the payroll setup or configuration in QuickBooks. Here’s a concise guide to fixing this error: Update QuickBooks: Ensure you are using the latest version of QuickBooks. Updates often include fixes for known issues. Go to the QuickBooks Help menu and select “Update QuickBooks” to check for updates. Verify Payroll Subscription: Confirm that your payroll subscription is active. Go to the “Employees” menu, select “Payroll Center,” and then “Account Overview” to check your subscription status. Check Payroll Items: Make sure all payroll items are correctly set up and linked. Navigate to the “Lists” menu, select “Payroll Item List,” and review the setup of each payroll item to ensure there are no discrepancies. Run the Payroll Update: Perform a payroll update by going to the “Employees” menu, selecting “Get Payroll Updates,” and then downloading the latest updates. This can resolve any issues related to outdated payroll tax tables. Reinstall QuickBooks: If the issue persists, consider reinstalling QuickBooks. Uninstall the application from your computer, restart it, and then reinstall the latest version. Following these steps should help resolve QuickBooks Payroll Setup Error 05396 40000. If the problem continues, contact QuickBooks support for further assistance.