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KimmieJ0
May 25, 2022
Question

Employee Health Contributions post tax vs Pre tax

  • May 25, 2022
  • 1 reply
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Forgive me because my brain hurts today.  I have taken over some responsibilities from someone previously handling qb and payroll etc.  That person is no longer here, and as I am reviewing things I notice that they incorrectly indicated that employee health insurance premiums are to come out post tax.  This is not according to our 125 plan and I want to make sure we get this changed as soon as possible.  My question is since we are 5 months into the year, and we already have post tax deductions from employee checks, will I need to set up another "Payroll list Item" to reflect moving forward these deductions are to be pre tax?  So essentially at the end of the year they will have a line item that reflects the amount that came out post tax, and a line item that came out pre-tax?

1 reply

JoesemM
JoesemM
May 25, 2022

I’m glad to see you in the Community, @KimmieJ0. 

 

I can see the importance of having accurate payroll records. This ensures your taxes and forms have the correct information.

 

Voluntary payroll deductions include medical, dental, and vision insurance premiums are both pretax and post-tax. However, there isn't a Pre or Post Tax to select from in the tax tracking section of the set up.

 

The post-tax are non-tax tracking deduction item like health, wage garnishment, employer loan repayment, etc. While the pre-tax, you’ll have to pay attention on tax tracking type because it will affects the forms 941, 940, and reports in the W2 box. For example: 401(k) employee deduction with or without a company contribution match; 403(b); Health insurance; etc.

 

Also, I’d recommend consulting your accountant about this matter. They can explain further the difference between pre-tax and post-tax in QuickBooks so your forms will be accurate.

 

I'll be sharing these articles that will further guide in setting and managing your deductions with QuickBooks:

 

Stay in touch if you have any clarifications or concerns. We're always ready to answer them for you. Enjoy the rest of the day.

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