QB Issue Resolution:

“Note that the liability/expenses that are suggested by QB in the item set up may be incorrect”

 

Here is why:

 

The Payroll Item(s) flow data to account(s). The Typical set up is that you will Accrue the amount (your expense held as Liaiblity) until you pay the health provider. It doesn’t increase the Paycheck at all.

 

If you are Not paying the health provider through Pay Liabilities, never set up the Payroll Item to link to a Liability account in the first place. This “company contribution” type item is the same as an Addtion + a Deduction = it does both at the same time. As long as you keep this in mind, you know what you are creating is “debit this and credit that.”

 

So, for instance, you Paid the health insurance all year and now you realize that needs to show on the W2. You set up that payroll item linking Both the Expense account link and the Liaiblity account link to the Same Expense account that you already paid out for the health insurance expense. You are creating an immeditae wash. When you run a detail report on that expense account, you would see, for instance:

 

$1,000 a month for 12 months that you paid as regular checks or bills, for this employee name.

$12,000 In and Out, because you put $12,000 on the Payroll Item on their paycheck (net = 0).

 

 

For these Company Contribution items, things get sticky when it is Subject to taxes. You cannot put only that one value on a paycheck and let taxes compute, if there is nothing upon which that tax can be withheld = deducted from a net. So, you might need to Lend them the tax amount as an Employee Advance to be repaid later. This often happens at year end, when people find out too late they completely overlooked something subject to tax and having mandated reporting.

Resolution for Issue 'Correct Payroll Item – Medical Insurance for Owners but Not Employees' available: Yes (Solved).
Source: Intuit Community forum.

Correct Payroll Item – Medical Insurance for Owners but Not Employees: this issue or error code is a known issue in Quickbooks Online (QBO) and/or Quickbooks. Support for this issue is available either by self-service or paid support options. Experts are available to resolve your Quickbooks issue to ensure minimal downtime and continue running your business. First try to resolve the issue yourself by looking for a resolution described below. If it is a complex issue or you are unable to solve the issue, you may contact us by clicking here or by using other support options.

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