Hello, We offer our employees a QSEHRA that accumulates $441.66 per month per employee. I'd like to be able to track this accumulating benefit and the reimbursements.

I've got helpful methods for tracking your employees' QSEHRA benefits and reimbursements in QuickBooks Online (QBO) Payroll, @userchris4.

The 21st Century Cures Act allows you to reimburse employees for healthcare coverage purchased through the individual market. The law includes stipulations for Qualified Small Employer Health Reimbursement Arrangements (QSEHRA).

You can start tracking QSEHRA by adding and setting it up as a deduction. Here's how:

1. Go to the Gear icon.
2. Choose Payroll settings.
3. Go to the Deductions tab.
4. Click Add a new Deduction/Contribution. 
5. Select the appropriate Category and Type. Then, enter its Description. I'd recommend reaching out to your accountant to ensure the best course of action for your organization.
6. Click OK.

I've attached a screenshot that shows the last four steps.

After that, visit each of your employee's profiles to add the item. To do this, here's how:

1. Go to the Payroll menu.
2. Select the Employees tab.
3. Choose the employee's name to open its profile.
4. Click the Edit employee button.
5. Go to the Does [Employee name] have any deductions? section and select + Add deductions. 
6. Choose the QSEHRA deduction and enter all the needed details.
7. Click OK to save the changes. Repeat as necessary.

Once done, QSEHRA will automatically be added to your employee's paychecks. With this, you're able to report to them what their available balance is.

Then, to reimburse employees for qualified expenses (tax-free) on their direct deposit payroll, you'll need to add a reimbursement pay type. Then, add the appropriate amount when running payroll.

Additionally, you can report reimbursed health coverage on your employees' W-2 forms. However, please note that adding the reimbursement pay type doesn't automatically generate an amount in box 12 with code FF unless you follow the W-2 reporting steps. If you wish to know more about this, check out this article: Report healthcare reimbursements (QSEHRA) on W-2 forms.

Let me know if you need further assistance with your QSEHRA setup in QBO. Simply drop your comments below, and I'll be more than happy to help. Have a good one.