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February 17, 2024
Question

QBO for Personal Finances - Gross paycheck income?

  • February 17, 2024
  • 2 replies
  • 0 views

I'm using QBO to manage my personal finances. I need to make an entry to capture the difference in income between my gross wages and net wages. My net wages show up as in imported transaction from my bank so that is taken car of already. Any suggestion on what type of entry is needed?

2 replies

February 17, 2024

Hello there, @RedOreRider

 

Hello there, pbj. We appreciate your time for posting here in Community. We want to make sure we provide the resolution you need regarding the entry you want to enter. With that said, we'd like to ask for additional details about your concern.

 

Please attach screenshots so we can get a clear picture of your current situation and supply the needed assistance to resolve this.

 

Feel free to visit us anytime here in the Community space if you have any follow-up concerns. We'll be happy to assist. 

Rainflurry
February 18, 2024

@RedOreRider 

 

It depends on what the difference is between gross and net.  Is the difference solely tax withholding and FICA?  Or, do you have IRA/401K contributions?  

 

Let's say, for example, your paycheck net wages are $1,000 and your gross wages are $1,250.  The $250 difference is $150 in withholding (combined fed, state and FICA) and $100 is an IRA contribution.  You would make a journal entry that increases your income by $250 and recording an offset amount of $150 to tax expense and $100 to your IRA asset account.  The journal entry would look like this:

 

 DebitCredit
Tax Expense150 
IRA (Asset)100 
     Gross Income 250

 

Hope that helps.