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J
jashenusa-yahoo-
February 19, 2024
Question

Changing from weekly to biweekly payroll

  • February 19, 2024
  • 1 reply
  • 0 views

If we enter the amount of 80 hours (2 weeks) into payroll but did not change the setting to biweekly, would it increase the tax rate?  Our system has been set up for weekly pay for years.  Is there a company wide setting to change or must it be changed per employee?

 

Reason for question is that after the change, one employee found an increase in the Federal Income tax and State income tax rate percentage.  Could this have moved that employee into a different tax bracket?

 

If the employee's rate of pay did not change, but we only changed from weekly to biweekly, the tax rate should have remained the same and the take home pay should basically be 2x the single week, right?

1 reply

K
Kurt_M
February 19, 2024

It's a pleasure to have you here today, @jashenusa. We'll share details on how QuickBooks Online (QBO) manages your taxes and how pay schedules can affect business taxes.

Yes, you're right about entering 80 hours into a weekly pay schedule employee can increase your tax rate. As we check here on our end, the option to change employees' pay schedules all at once is unavailable. That said, you'll have to modify manually each of your employee's current pay schedule. We'll write down the steps to get you going:

  1. Go to Payroll, then Employees.
  2. Select your employee.
  3. From Employment details, select Start or Edit.
  4. From the Pay schedule ▼ dropdown, select the pay schedule for the employee moving forward. Or, to create a new pay schedule, select + Add pay schedule.
  5. Fill out the appropriate fields. Then select Save.
  6. When you're done, select Save.

 

Feel free to visit this page: Set up and manage payroll schedules.

Also, if you create a new bi-weekly pay schedule, you can copy or apply it to new employees you enter inside your company file. However, this action doesn't apply to existing workers inside the company. The program depends on the details you've added when setting up employees and your current company setting. We'll list the factors that can affect your federal income taxes:

  • Employee’s W-4
  • Pay frequency
  • Gross wages
  • Percentage or wage bracket method

 

Feel free to check this page for more information: Understand how your payroll taxes are calculated.

 

Regarding the State income tax rate, know it varies by state. We recommend checking this page for more information to see the updated rate for the state you're currently in: Access state agency websites for payroll.

 

In addition, here are some articles to help you learn more about wage base limits, keep track of your payroll activities, and manage employee payroll information inside the program:

 

 

In case you need further assistance managing taxes and employee setup inside QuickBooks. We'll be around to help you out, @jashenusa. Feel free to comment below so we can respond as soon as possible. Keep safe.

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