How do I calculate the source deductions and record them for a loan we forgave to our pastor? I know it will be a taxable benefit but need help accounting for it.

Hello Melanie,

I'm happy to see that you're looking for the most accurate way to track your source deductions and loans using QuickBooks Online. If you're using QuickBooks Online Payroll as well, you'll find that your source deductions are automatically calculated for you based on the pay types and deductions you set up and use. Let me point you in the right direction.

Since I don't have much information about the loan that you're referring to, it's hard for me to have a full understanding of what you're trying to do and how this loan applies to your payroll source deductions. You can refer to our articles on Supported pay types and deductions as well as how to Set up voluntary deductions in Online Payroll if you'd like to learn more, and feel free to ask questions here for me or other members of the Community.

When it comes to how to record this loan that you're referring to, the first step is to reach out to an accountant. If you're already working with one, you can navigate to the My Accountant tab to invite them to work on your books with you. The same page features the Find a pro to help button where you can navigate through our database of QuickBooks-certified accountants that'd be happy to help you if you need it. An accountant is best equipped to help you figure out which calculation and recording method will work best in this scenario. 

Once you've determined exactly what type of transaction you're looking to record, please fill me in so I can walk you through how to record it using QuickBooks Online. Include any additional details you think I might need so I can give you the best support possible. Have a great day!