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g_Quik_Online
November 10, 2023
Solved

COBRA payment from former employee

  • November 10, 2023
  • 1 reply
  • 0 views

Hello,

We have a former employee who elected to participate in COBRA.  We received a payment from them, checked dated in October but it was received in November.  The payment is for November COBRA.  How would you account for this deposit?  Thanks!

Best answer by QueenC

Hello there.  I understand the importance of recording this deposit, and I'm here to assist you in achieving this and ensuring an accurate record. 

 

To account for this deposit, we can record this as a liability in QuickBooks Online.

 

First, let's create a liability account to track the COBRA payments. You can name it something like "COBRA Liability."

 

After that, we can now record the deposit and select the appropriate bank account where you received the payment.

 

Here's how:

 

  1. Go to the + New button then select Bank Deposit.
  2. Enter the Date when you received the payment.
  3. In the Add funds to this deposit section, enter the payment amount and select the COBRA liability account you created.
  4. Select the former employee from the Received From dropdown.
  5. Once you have entered all the necessary information, select Save and close.

 

Still, it's always a good idea to consult with an accountant or bookkeeper to ensure proper accounting practices for your specific situation. If you don't have one, you can visit our ProAdvisor website to find an expert.

 

I'm also adding this reference should you need to set up benefits or deduction items for your employees: Set up, change, or delete employee-paid payroll deductions.

 

I want to ensure that all of your concerns are addressed properly. If you need any more help with recording deposits in QuickBooks Online, you can always ask your question here by hitting the Reply button or starting a new thread. Stay safe.

1 reply

Q
QueenCAnswer
November 10, 2023

Hello there.  I understand the importance of recording this deposit, and I'm here to assist you in achieving this and ensuring an accurate record. 

 

To account for this deposit, we can record this as a liability in QuickBooks Online.

 

First, let's create a liability account to track the COBRA payments. You can name it something like "COBRA Liability."

 

After that, we can now record the deposit and select the appropriate bank account where you received the payment.

 

Here's how:

 

  1. Go to the + New button then select Bank Deposit.
  2. Enter the Date when you received the payment.
  3. In the Add funds to this deposit section, enter the payment amount and select the COBRA liability account you created.
  4. Select the former employee from the Received From dropdown.
  5. Once you have entered all the necessary information, select Save and close.

 

Still, it's always a good idea to consult with an accountant or bookkeeper to ensure proper accounting practices for your specific situation. If you don't have one, you can visit our ProAdvisor website to find an expert.

 

I'm also adding this reference should you need to set up benefits or deduction items for your employees: Set up, change, or delete employee-paid payroll deductions.

 

I want to ensure that all of your concerns are addressed properly. If you need any more help with recording deposits in QuickBooks Online, you can always ask your question here by hitting the Reply button or starting a new thread. Stay safe.

    G
    g_Quik_OnlineAuthor
    November 10, 2023

    Thank you for the reply.  Unfortunately, it doesn't answer my question of how to account for it.  I know how to make a deposit.

    Rainflurry
    Rainflurry
    November 10, 2023

    @g_Quik_Online 

     

    Re-read @QueenC 's reply.  It is correct.  Assign the COBRA liability account to the deposit as of the date the payment was received.  That will increase your bank account and the COBRA liability account.  COBRA payments should be made from the COBRA liability account.    

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