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mtic
January 10, 2025
Question

Philadelphia city wage payroll taxes, and frequency

  • January 10, 2025
  • 1 reply
  • 0 views

Hi, I just started using QBO payroll taxes for our first employee. The employee is resides in Philadelphia, PA but works in NJ and elects for NJ-165. So we withhold federal, PA state, NJ unemployment/UI/FL/etc., and Philadelphia city wage tax. QBO is able to automate all of those except Philadelphia.

 

QBO constantly reminds me that I need to pay Philly taxes myself, which is fine, but I just checked with the city who states we just need to remit quarterly. But in QBO it shows amount due per paycheck individually.

 

I have two questions:

1. Is there any way to automate Philadelphia city wage tax filing?

2. If not, is there a way to configure QBO to lump Philadelphia city wages due quarterly instead of per paycheck? (like QBO does for state sales tax).

 

Thanks

1 reply

Clark_B
Clark_B
January 10, 2025

Yes, there's an option to automate Philadelphia city wage tax filings if you've set QuickBooks as your preference in paying your taxes and filing your forms, @mtic. Let me provide further information and guide you through the process of changing your preference.

 

Once Auto-Pay/File is activated, it'll automatically handle tax payments starting from the first day of the following month. However, any tax liabilities incurred before activation must be manually processed, as the Tax Filing System will only manage future payments.

 

To change your taxes and form preference, follow the steps below:

 

  1. Go to Settings, then select Payroll Settings.
  2. From the Taxes and Forms section, select Edit.
  3. Choose the option Automate taxes and forms for QuickBooks to automatically pay your taxes and file your forms.
  4. Select Save, then Done. 

 

For more detailed information and Step 2, check this article: Set up QuickBooks Payroll to pay and file your payroll taxes and forms.

 

For your second inquiry, QBO can adjust your Philadelphia city wages into a quarterly lump sum payment. To do this, you need to update your tax payment frequency to Quarterly. Here's the process:

 

  1. Click on the Gear Icon or Settings and navigate to Payroll Settings.
  2. Select your Philadelphia tax and adjust the frequency to Quarterly for tax payments.
  3. After making the changes, click Save.

 

 

Additionally, please note that tax liabilities are calculated based on each paycheck date. If it's not paid, these liabilities will accumulate accurately, allowing you to remit the total amount quarterly as required.

 

You can also check this article to learn how to access your state agency websites.

 

Moreover, I recommend exploring this article for an in-depth insight into your business finances, employee information, and other payroll data: Run Payroll Reports. 

 

Furthermore, consider exploring QuickBooks Payroll if you're looking to enhance your payroll processing capabilities. Features like time-tracking and expedited direct deposits can significantly benefit your business.

 

I want you to know that I'm here to further assist you with any questions you have about your wage tax filing in QuickBooks. Just utilize the comment section for a quick reply.

M
mticAuthor
January 10, 2025

Hi @Clark_B 

 

Thank you for the detailed response. I followed the steps and confirmed that I already have Automate taxes and forms box checked. It is filing federal and state taxes perfectly, it is just Philadelphia city taxes that it is saying needs to be done manually.

 

To ensure I have it correctly set up:

In the same menu (Settings > Payroll Settings > "Pennsylvania tax info") there is State tax with my Employer Account ID and then below that a section called Local tax, with "Pennsylvania Local Tax Agency" where my "Local EIN" I put in the Philadelphia wage account # in it. Hopefully that sounds correct.

 

Thank you.

J
Jayson_E
January 11, 2025

Thank you for the detailed update, mtic. It’s great to hear that you followed the steps provided by my colleague and confirmed that the Automate taxes and forms option is enabled. I'm here to help you verify your setup and ensure everything is configured correctly.

 

Yes, your setup in QuickBooks Online(QBO) for Pennsylvania tax information is correct. Having your Employer Account ID in the State tax section and using your Philadelphia wage account number as the Local EIN in the Local tax section is right on track for reporting both state and local taxes. 

 

You can also refer to this article for more detailed information: Set up QuickBooks Online Payroll to pay and file your payroll taxes and forms.

 

Additionally, you can check out this article on how to run payroll reports, which provides information on accessing and customizing various payroll reports, including details about employee info, wages, taxes, and deductions in QBO: Run Payroll Reports.

 

If you have any more questions about managing your payroll in QuickBooks Online (QBO), feel free to drop a reply below. The QuickBooks team is ready to provide support and address any concerns you might have. We're here to help you succeed!

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