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Deadwood Al
March 27, 2024
Question

Earnings subject to FUTA

  • March 27, 2024
  • 1 reply
  • 0 views

Relatively new to QB Payroll and setting up taxability:  When I run the Tax Form Worksheets, there is a difference between "Total Taxed Wages" and "Total Taxable FUTA Wages" and it says "Difference (should be 0.00"  As I started here late last year, I thought that it may have been a change in something during the year so I wanted to wait to go thru a quarter where I knew I was responsible for the whole thing. The "taxed" wages is higher than the "taxable", so that tells me that there is something that is being taxes that shouldn't be. Probably a benefit or something.

 

My problem is that I am not positive how the settings ... in the Payroll Item List, I assume???? ... actually work, so I'm hoping someone can tell me what the setting should look like and any short cuts to track this down.

 

One area of question: the company pays 100% of the employee medical insur, dental and vision cost. There were/are a couple employees who have Medicare and elected not to take the employee medical, so the company reimburses them for the Medicare & Part D cost those employees have to pay. Is the reimbursement the company pays these employees taxable? The "tax tracking" field for that reimbursement is "Other". Could that be part/all of the problem? Should that be taxable?

 

Any guidance/suggestions is appreciated. Thanks in advance.

1 reply

S
ShyMae
March 27, 2024

I can help you run a payroll checkup to identify why your report shows that the tax wages are higher than the taxable wages, Deadwood. 

 

The payroll checkup involves reviewing your employee records and your setup of compensation, benefits, and taxes, including wage and tax amounts. Let me guide you on how to do it:

 

  1. Hover to Employees, then select My Payroll Service.
  2. Select Run Payroll Checkup and click Data Review. If there are errors, you must fix them before proceeding to the next step.
  3. In the Review your payroll data window, select No to allow the Payroll Checkup to create wage-based discrepancy adjustments.
  4. Hit Continue, then Finish.

 

We can also review your employee's payroll setup and ensure that the correct payroll items are applied. For that, please follow these steps:

 

  1. Hover to Employees, then click Employee Center.
  2. Double-click the employee and select the Payroll Info.
  3. From the Additions, Deductions, and Company Contribution section, verify whether the payroll items are set up correctly.

 

If you wish to make necessary changes to your payroll item, you can follow these steps: 

 

  1. Hover over to Lists, then click Payroll Item List.
  2. Double-click the payroll item to check if it was set up correctly. 
  3. Select Next until Finish appears, then select Finish.

 

On the other hand, I can only share the technical input in setting up your payroll items. Therefore, I'd recommend consulting your tax professional to know if the reimbursement should be taxable. In the meantime, you can read how payroll taxes are calculated in QuickBooks Desktop Payroll to get more in-depth information and guidance. 

 

For future reference, you can run a payroll report in QuickBooks Desktop to see a detailed summary of your company's payroll expenses, including employee salaries, bonuses, taxes, and other related costs.

 

I'm here to help you further whenever you require assistance with your taxes and payroll items. I'll make sure to back you up. Kindly utilize the reply button below and enter your queries. 

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