How can I reverse a direct deposit to a current employee? The money has already been deposited in her account and she is okay with it being reversed.

Hi david-jimspizza,

Welcome to Community!  I can see how additional fees to have payroll funds reversed could impact your business.  QuickBooks Online Payroll has the flexibility you need when situations like this arise.  There are two options for the reversal of funds.  I'd be happy to assist!

As your employee has agreed to have the funds reversed, they could e-transfer the amount back to the business or by any other format.  The second option would be to create a deduction item for payroll and apply it to the employee.  You'll then have the option to enter the amount to be deducted when running payroll.

Here's how to create the deduction:

1. Click on the Gear in the top right and choose Payroll Settings

2. Select Pay Schedules

3. Pick Deductions or Contributions and then Add a New Deduction 

4. From the dropdown menu, select Other Deductions and enter a description 

5. When finished, hit OK

Now that you've set up the item, you're ready to add it to the employee's payroll by following these steps:

1. Open Payroll and then Employees from the left menu

2. Select the Employee from the list

3. Click on the Edit pencil next to Does this employee have any deductions, choose the Deduction created from the dropdown list

4. Choose which Type or sub-category of the deduction

Note: You can learn more about each type’s tax implication by selecting the triangle.

5. Enter the Provider name in the box provided. This is how the deduction/contribution will show up on the employee’s pay cheque or pay stub.

6. You can enter the Employee deduction per pay period and choose $, % or None, with an annual maximum to avoid over deducting

7. Hit Ok when done

You're all set!

Here's a helpful article to keep on hand for future reference when you need to setup and add deductions and contributions to an employee in QuickBooks Online.

Please don't hesitate to reach back out if you have any other questions.  We'd be glad to help!