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Big-Al
November 11, 2022
Solved

New tax items

  • November 11, 2022
  • 2 replies
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We wanted to isolate production wages & overtime and taxes into the COGS grouping, and I created Payroll Items for Production Hourly, Production Salary, and Production Overtime ... but when I wanted to create a Production FUTA the system responded with a display box that said sometime to the effect of "You don't need to add any tax accounts since Quickbooks has already created the following accounts for you."  It then listed the FIT, FUTA, SS ER paid, SS EE paid, Medicare ER paid and Medicare EE paid.  I wanted to create a FUTA that posted to the same liability account but recorded expense to a Production Tax account and leave the G&A expense into the original account.  Same idea for the SS and Medicare ER paid items.

 

Is there a way to add these accounts in the Federal Tax group, or do we have to live with only the ones QB says already exist?

 

Thanks in advance for any guidance.

Best answer by BigRedConsulting

The message likely meant that you can't set up another instance of any tax, which is the case: Only one payroll item can be created for each supported tax. For example, you can't create two FUTA tax items, or another SWH item for the same state.

 

So, to attribute all of the expenses for these employees to a different expense account, the only way is to create a Journal after creating the payroll to shift the desired expenses from one account to another.

2 replies

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ChristieAnn 11
November 11, 2022

Welcome back to the QuickBooks Community, Big-Al. Let me discuss on accounts works in QuickBooks Desktop. Then, ensure you'll be routed to the right person to assist you further in setting up your FUTA so your account stays accurate.

 

When you set up and open a company file, QuickBooks automatically adds accounts to your chart of accounts that suit your business. That's why the system responded with a display box stating the error "You don't need to add any tax accounts since QuickBooks has already created the following accounts for you". Additionally, you can also make changes to the existing accounts or add new ones so you can better track how much money comes in and out. 

 

However, an option to add accounts in the Federal Tax group is currently unavailable. With this, yes, you can have used the created accounts in QuickBooks or the ones that already exist. Furthermore, I recommend consulting an accountant for additional assistance on how you can handle or manage the tax setup you wish to set up.

 

Lastly, you may refer to this article to see various details on how a chart of accounts works in QBDT and how to run a quick report for details: Work with the chart of accounts in QuickBooks Desktop.

 

Please click the Reply button below if you have other concerns related to your accounts in tracking transactions in QBDT. I'm always here to help, Big-Al. Have a great day!

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Big-AlAuthor
November 11, 2022

ChristieAnn -- thank you for responding.  

 

Not sure if I understood correctly:  it seemed to me that you were advising me on adding GL accounts to connect to the already existing Federal Tax items.  I already have GL accounts present that should reflect the cost of FUTA amounts generated by Production payroll, the problem is that the system doesn't seem to let me add an additional FUTA Federal Tax Item that I would name Production FUTA.  It would post to the same liability account as the original FUTA Federal Tax Item, but the expense amount would post to a different GL expense account that I have already created ... in order to show some of the FUTA expense to Production payroll and some FUTA expense to G&A payroll.  

 

I know how to add a GL account, and I am an accountant so I understand how I want the expense portions to be recorded.  What I don't know if how to create an additional Federal Tax Item that would capture the tax expense properly.  Or is the structure of QB as it relates to taxes not able to separate that level?

BigRedConsulting
BigRedConsultingAnswer
November 11, 2022

The message likely meant that you can't set up another instance of any tax, which is the case: Only one payroll item can be created for each supported tax. For example, you can't create two FUTA tax items, or another SWH item for the same state.

 

So, to attribute all of the expenses for these employees to a different expense account, the only way is to create a Journal after creating the payroll to shift the desired expenses from one account to another.

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Big-AlAuthor
November 11, 2022

Thanks BigRed ...

 

That's what I was afraid of / assuming would be the case.  Another feedback suggestion to Intuit.

 

With QB going after larger, more complex organizations with QB Enterprise, this is an area they will need to address. Having the ability to categorize related expenses into COGS area of the income statement separate from the SG&A area is needed, and the answer from Intuit can't always be to use Excel to manipulate data or make a GJE to move dollars to where they should be.  As good as QB is in many instances, Intuit still seems to have a lesser regard for the time users need to spend to get data that a more comprehensive QBE design structure could easily provide.

 

As always, I do thank you for responding an giving a succinct answer to the problem, even when the response isn't the news I was hoping for.

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