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Brandi8
January 28, 2022
Question

Can anyone help me understand how payroll taxes for the Employee and Employer are calculated? If I were to do it manually.

  • January 28, 2022
  • 1 reply
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I am unable to figure out the consistent percentages that QBO used in calculating the payroll taxes with an employee. They differ from paycheck to paycheck. For example: Paycheck 1 -- Gross: $1,040 Bonus: $100 Per Diem: $600 Total Gross: $1,740 -- Federal taxes were calculated at 5.56% of gross, deducting ($96.76) Paycheck 2 -- Gross: $1,200 Bonus: $100 Per Diem: $400 Total Gross: $1,700 -- Federal taxes were calculated at 6.35% of gross, deducting ($108.00). What am I missing? Any help in just understanding how to manually calculate the payroll to understand what QBO is doing would be a great help.

1 reply

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LeizylM
January 28, 2022

Good to see you here, Brandi8. 

 

In QuickBooks, the payroll wage and tax calculations are derived from the payroll data and transactions you've entered. QuickBooks Payroll will correctly calculate wages and tax amounts as long as your employees and payroll items are set up.

 

The following article is a great source of learning regarding payroll and how it's calculated: Payroll 101.

 

I've got you these helpful articles for ideas to help manage your account and payroll transactions: Help Articles for QuickBooks Online Payroll.

 

I'm always around to lend a hand if you have more questions about managing payroll in QuickBooks Online. Just tag my name in the comment section so I can assist you further. Take care and have a good one.

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