QB Issue Resolution:

Since your employee is no longer with the company and was being setup for a secondary state, you’ll need to do the following steps below:

  • Inactivate all work locations in that state.
  • Set the tax status for all employees to “No Not Withhold” for that state.
  • Confirm that you wish to disable Multistate Plus support for that state.

Let me show you how to inactivate a work location in a secondary state. Before that, you have to make sure that no active employees are currently assigned to the work location.


Here’s how to inactivate a work location:

  1. Go to the Gear icon.
  2. Click Payroll Settings.
  3. Under Company and Account, click Work Locations.
  4. Select a Work Locations.
  5. Mark the Inactive checkbox.
  6. Click Save.


Once done, you can now update an employee’s tax status and opt out of a secondary state:

  1. Click Employees.
  2. Click on the employee’s name.
  3. Click Edit in the Taxes & Exemptions section.
  4. In the section for the secondary state, select Do Not Withhold from the Filing Status drop-down.
  5. Zero out any additional amount for the secondary state.
  6. Mark the checkbox to opt out of payments and forms for the secondary state.
  7. Click OK.
  8. Repeat steps 1-7 for any other employees who reside in the secondary state.

After performing the steps above, our system will provide the tax liabilities for MA state and you will no longer receive reminders for tax payments and form filings to that state.


Here’s a great resource that you can check on for more detailed steps: About multistate employment payroll situations.


Resolution for Issue 'Employee Withholdings in Another State' available: Yes (Solved).
Source: Intuit Community forum.

Employee Withholdings in Another State: 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.

Support for Another State
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