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spmorin
March 15, 2021
Question

How do I record an employer end of year contribution to a solo 401K in QB online?

  • March 15, 2021
  • 6 replies
  • 0 views
I have a c-corp with an s-corp election that established a solo 401K (husband and wife owners). Throughout the year, employee contributions were deducted from paycheck, which was set up and recorded in QB. After the close of the year, the company made an employer contribution to both employee's 401K accounts directly to the financial institution. The questions I have is how do I record this one-time payment by the employer in QB online? I understand this will be an expense for 2021 (which is fine), although the contribution was made for 2020 retirement contribution limits. Appreciate any help!

6 replies

D
DebSheenD
March 15, 2021

Hello, spmorin!



Thank you for reaching out to the Community. I'll make sure that you can record an employer 401k.


Here's how:

  1. From the left menu select the Gear icon and select Payroll Settings.
  2. Under Payroll, select Deductions / Contributions.
  3. Select Add a New Deduction/Contribution.
  4. For Category, select Retirement Plans.
  5. For Type, select the applicable retirement plan.
  6. Enter the name of the provider or plan.
  7. Select Ok.


You can also check this article for more details about 401k:  Set up a payroll item for retirement benefits (401(K), Simple IRA, etc.)

Please let me know if you have additional questions or concerns. I'm always here to help.

 

S
spmorinAuthor
March 17, 2021

Thanks for the reply!

I've already set up the 401K account and have been making regular deductions from payroll during the year. The question is how do I record this one-time contribution by the employer in QB online?

M
Mark_R
March 18, 2021

Glad to have you back, @spmorin.

 

I'll help record your one-time company-paid contribution in QuickBooks Online (QBO).

 

You'll want to add the contribution to each of your employees and run a one-time paycheck. This way, the item (401K) will affect the employee's W2 and payroll reports. After processing the payroll, you can manually remove the contribution. Let me guide you through the process.

 

First off, let's add the company contribution to each of your employees. Here's how:

 

  1. Click Payroll from the left menu, then select Employees.
  2. Select each employee on the list.
  3. In the employee's information, click the pencil icon beside Pay.
  4. Under Does this employee has any deduction?, click Add additional pay types or the pencil icon depending on what you see.
  5. Fill out the necessary information and the company-paid contribution.
  6. Click OK, then Done.
  7. Then, repeat steps 2 to 6 for the rest of your employees.

 

Once done, you now create a one-time paycheck for your employees. After processing it, delete the contribution by going back to the Does this employee has any deduction? section and clicking the trash icon.

 

I'm adding this article to learn more about adding a payroll deduction or contribution in QBO: Add or edit a deduction or contribution.

 

Please know that I'm just a reply away if you need any further assistance processing payroll. Have a good one.

G
Go6
January 5, 2022

Not my question. I need to remove a deduction for retirement contributions before I do w2 deducted for a plan that the employee was not qualified to participate in. I refunded the deduction to the employee but don’t know how a correct records in QB

AlexV
AlexV
January 6, 2022

Hi Go6!

 

Thanks for joining this thread. Let me share some details about this removal of deduction.

 

Yes, there's a way to correct your W-2 before you file it. Our Payroll Team will make an adjustment to your payroll to remove the deduction. This means I recommend you to contact them so they can make the correction on your behalf.

  1. Click the (?) Help icon and enter Talk to a human (then type it again when prompted).
  2. When asked by the bot, enter "Payroll Correction".
  3. Select I still need a human, then proceed with Contact us or Get help from a human.
  4. Choose either Chat or Callback.

 

Also, these are the articles you can check on how to correct filed W-2 and understand its figures:

 

Keep on posting here if you need more help in preparing your tax forms. Take care!

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nwoodard34
May 6, 2022

OP: Was the QBO helpdesk able to resolve this for you when you called?  Extremely frustrating that the world's largest bookeeping service doesn't have a feature that is super common to S-Corps built in.  Wondering if it is worth my time to call and try to get a resolution through whatever hacks or backdoors they can do on the call.  

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nwoodard34
May 13, 2022

LOL this thread is an absolute joke.  Why anyone choose to use QBO for payroll is beyond me--absolutely awful.

    G
    gtc_jg
    December 29, 2023

    Did you get a fix for this issue ? I am trying to do the same exact thing and its been 2 hours with multiple reps and they don't understand the problem!

     

    G
    gtc_jg
    December 29, 2023

    Did you get a fix for this issue ? I am trying to do the same exact thing and its been 2 hours with multiple reps and they don't understand the problem!

     

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