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wendy99
January 9, 2023
Question

Partner Draws

  • January 9, 2023
  • 1 reply
  • 0 views

We have two partners that are 50/50 and we have been paying their draws through payroll with no taxes, and allocated to the equity account so that they can be direct deposited.  I am finding that this is not ideal when it comes to year end reports like FUTA.  Is there another way to pay the partners and still have direct deposit??

1 reply

BigRedConsulting
BigRedConsulting
January 9, 2023

To fix your payroll reporting, be sure that the paychecks you have recorded don't use earnings items. Instead use Addition type item that is configured with None as the tax tracking type and which doesn't impact any taxes and (probably) uses an Equity account.

 

QuickBooks does offer the ability to send DD orders to Vendors, which is a better way to record owner draws against their Equity.  I think it's a separate service to sign up for.

 

If your bank offers ACH processing via a NACHA file, another option is our BRC Direct Deposit File Creator , which can be used to create DD orders based on data you record in QuickBooks, both paychecks (not for your case) as well as standard checks and bill payment checks.

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wendy99Author
January 9, 2023

Thanks for the information.  That is helpful.  However, can changes be made to completed paychecks in 2022, in order to get my FUTA to calculate correctly??

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