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NancyC1
March 28, 2023
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Payroll: what taxes does EMPLOYER ADDRESS affect

  • March 28, 2023
  • 1 reply
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We have an employee that moved from WA to MI.  He continues to work out of WA.  If I leave his work location address as WA does that impact state unemployment and/or state worker's comp?  We want to pay MI unemployment but MI does not want or require worker's comp because his work location is truly NOT MI.  However, MI does require paying into their SUI system.

 

Obviously, I can just process a couple payrolls to learn the impact; however, I'm hoping you in the community already have the answer for me 🙂

Best answer by Mich_S

Glad to see you again here in the Community, @NancyC1. 

 

I want to share some insights about managing workers' compensation in QuickBooks Online Payroll ( QBOP ).

 

QBOP is only limited to managing WA Workers' Compensation. Additionally, once you set up WA Workers' Compensation classes and rates, QBOP automatically calculates the premiums or any applicable taxes on your employees' paychecks.

 

I've included these handy articles you can read about handling workers' compensation in QBOP:

 

 

Keep in touch if you have other questions about payroll or QuickBooks. The Community is always ready to back you and your business. Keep safe.

1 reply

Bryan_M
Bryan_M
March 28, 2023

It's good to have you here, @NancyC1.

 

To clear things out. Yes, there would be an impact on your state unemployment and state worker's compensation if you leave his work location address as Washington (WA). Since both states have different state tax policies.

 

This becomes more challenging if your employee works in a state where your company is not registered. For each state where your company has employees, you must register your business with the local and state tax authorities.

 

You should also get in touch with the Michigan tax agency for additional guidance on how to set it up correctly.

 

Once the work location had been confirmed, we'll set up your employee and payroll taxes in a new state. Here's how: 
 

  1. Go to Payroll, then Employees.
  2. If your employee is new, select Add an employee.  Otherwise, select your employee from the list.
  3. From Employment details, select Start or Edit. Select or add the work location where you’re required to pay State Unemployment Insurance.  If you have remote employees, the work location may be different than where your employee physically works. Then select Save.
  4. From Tax withholding, select Edit. Go to the State withholding section. If you see two states:
    • If you don’t need to collect state withholding in one state: in the Filing Status ▼ dropdown, select Do not withhold (exempt).
    • If there’s a reciprocity agreement between the two states, select if your employee gave you a Certificate of Nonresidence form. The form determines which State Withholding is collected.
  5. If you see a Local Taxes or Other taxes section, select the applicable taxes and enter the rates.
  6. If you or your employee are exempt from any taxes (not common), from Tax Exemptions, select the applicable tax(es).
  7. When finished, select Save.

 

For future use, if you want to access your state agency websites, feel free to read this article: Access state agency websites for payroll.

 

Click the Reply button below if you have additional questions about Unemployment tax. I'll be happy to lend a hand. Have a good day!

N
NancyC1Author
March 30, 2023

Thanks, Brian.  You included this statement:  Select or add the work location where you’re required to pay State Unemployment Insurance.   I can therefore assume that WORK STATE drives SUI.  Can you please tell which state (Work or Residence) drives Worker's Comp?  How does the QB program and/or payroll team know which state to file workers comp in?

 

Many thanks.

Nancy

M
Mich_SAnswer
March 30, 2023

Glad to see you again here in the Community, @NancyC1. 

 

I want to share some insights about managing workers' compensation in QuickBooks Online Payroll ( QBOP ).

 

QBOP is only limited to managing WA Workers' Compensation. Additionally, once you set up WA Workers' Compensation classes and rates, QBOP automatically calculates the premiums or any applicable taxes on your employees' paychecks.

 

I've included these handy articles you can read about handling workers' compensation in QBOP:

 

 

Keep in touch if you have other questions about payroll or QuickBooks. The Community is always ready to back you and your business. Keep safe.

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