Do we have to use STP if we have only have one standard employee and the other two employees are considered "closely held"?

Payroll and STP

Yes you will need to set up STP, you can use the following guide for assistance on this: https://quickbooks.intuit.com/community/Payroll-and-STP/How-do-I-enable-Single-Touch-Payroll/m-p/278...

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