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smoreland1
November 24, 2020
Solved

Additional Federal Income Tax, can I withhold a percentage (20%) instead of a fixed amount ($20)?

  • November 24, 2020
  • 2 replies
  • 0 views

In the additional federal income tax withholding box, I tried to enter 20% instead of fixed dollar amount and it would not allow me to do so.  Is it possible to withhold an additional 20% of federal income tax per the employee's request?

    Best answer by JonpriL

    Hello @smoreland1,

     

    As of the moment, there isn't an integrated way to withhold an additional 20% federal taxes for your employee. This is the reason why you received such an error prompt when setting it up in the system.

     

    That being said, you can consider manually calculating the 20% withholding amount of your employee's taxes and enter it directly on the Extra Withholding field under payroll information of your employee's profile.

     

    Additionally, you can also browse for the content of this helpful article to get a better view of how your employee's taxes are calculated: Understand the tax amounts reported on your employee's paycheck.

     

    If there's anything else that I can help you with, please let me know in the comments. I'll be here to lend a hand. Stay safe!

    2 replies

    J
    JonpriLAnswer
    November 24, 2020

    Hello @smoreland1,

     

    As of the moment, there isn't an integrated way to withhold an additional 20% federal taxes for your employee. This is the reason why you received such an error prompt when setting it up in the system.

     

    That being said, you can consider manually calculating the 20% withholding amount of your employee's taxes and enter it directly on the Extra Withholding field under payroll information of your employee's profile.

     

    Additionally, you can also browse for the content of this helpful article to get a better view of how your employee's taxes are calculated: Understand the tax amounts reported on your employee's paycheck.

     

    If there's anything else that I can help you with, please let me know in the comments. I'll be here to lend a hand. Stay safe!

      T
      TaxGuys
      February 25, 2023

      The calculation that QB is doing on the paychecks is wrong - by a lot!  Has there been a fix issues?  This is a HUGE problem!  And manually calculating the taxes for each paycheck is not a viable solution!!!

        BigRedConsulting
        BigRedConsulting
        February 25, 2023

        @smoreland1  RE: Is it possible to withhold an additional 20% of federal income tax per the employee's request?

         

        No, not possible because you are required to follow the W-4 the employee gives you, and there is no way to specify a percentage rate on the W-4.

        C
        ChristieAnn 11
        February 25, 2023

        Hi there, TaxGuys.

         

        Thank you for visiting the QuickBooks Community. I'll be sharing details on how QuickBooks Desktop calculates the taxes that are reported on your employees' paychecks and payroll forms. 

         

        As a business owner, payroll is one of your most essential tasks and can be time-consuming. With QuickBooks Payroll, taxes are calculated automatically, and not only does it save you time but it also helps you focus more on your business. You can click this article to see details on how QuickBooks calculate taxes reported on your employees' paychecks: Understand how your payroll taxes are calculated.

          

        Then, I suggest updating your QuickBooks Desktop to the latest release. This way, you always have the latest features and fixes. I also recommend the same thing for your payroll tax table. This helps you have the most current and accurate rates and stay compliant with paycheck calculations.

         

        Since paycheck calculation in the program is incorrect, you can revert it. It will undo any payroll data that was saved prior to the update. Please keep in mind that this will only apply if you're still in the middle of payroll or your paycheck is still being processed.

         

        Here's how:

         

        1. Go to Employees menu, then select Pay Employees
        2. Choose Scheduled Payroll or Unscheduled Payroll.
        3. Select Resume Scheduled Payroll. You’ll see some employees’ names highlighted in yellow. These are the employees that have had changes.
        4. Right-click on the employee name that’s highlighted in yellow.
        5. Choose Revert Paychecks. 

         

        However, if the paycheck has already been created and processed, you must delete it and recreate it so that the correct taxes appear on the employee's paycheck.

         

        Lastly, you may refer to this artilcle to view steps on how you can create a specific payroll report to see what you've paid out in your QuickBooks payroll: Create a payroll summary report in QuickBooks.

         

        Don't hesitate to click the Reply button below if you still have concerns about taxes. I'm always around to help, TaxGuys. Have a good one!

        D
        Deemarie71
        March 21, 2023

        Duplicated response...ignore this message

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