How do I make sure a payroll allowance is not being taxed

Hi neiligooding-gma!

Welcome to the Community! I'll provide information about the type of pay you mentioned.

If you use the Allowance pay type for your employee's allowance, it's always taxable, and we're unable to change it. I'm just curious though, what kind of allowance is this? There are non-taxable pay types that you can use if they apply to your situation. We have the Nontaxable Per Diem and Clergy Housing (Cash). 

1. Go to Payroll, then Employees.
2. Select your employee.
3. From Pay types, select Edit.
4. Click the Supported pay types? hypertext to see how they will affect your form and to know which one is taxable or not.
5. In the Additional pay types section, you will see Nontaxable Per Diem and Clergy Housing (Cash).

You can always go back to this thread if you have more questions about your employee's allowance.