QB Issue Resolution:

Let me walk you through setting up a negative deduction.

In QuickBooks Desktop Payroll, you can create a non-taxable reimbursement payroll item for the insurance payments. This way, the money won’t be added to the employee’s taxable earnings.

To create a reimbursement item:

  • Add a new payroll item
    1. From the Lists menu, select Payroll Item List.
    2. Click the Payroll Item button, and then select New.
    3. Select the Custom Setup option button, and then click Next.
    4. Select the Addition item type, and then click Next.
  • Set up the new item
    1. Select an expense account to track amounts.
    2. Set the Tax Tracking type to None so that the amounts do not report on tax forms, and then click Next.
    3. Choose the Calculate this item based on quantity radio button, and then click Next.
    4. Choose net pay, and then click Next.
    5. Enter a Default Rate, and then click Finish.
  • Add the item to the employee’s record.
    1. Go to the Employees menu, then select Employee Center.
    2. Double-click the employee’s name.
    3. Go to the Payroll Info tab.
    4. Add the item form the drop-down list under Additions, Deductions, and Company Contributions.

For the detailed steps and additional information, you can go through this article: Create a non-taxable reimbursement payroll item in QuickBooks Desktop Payroll.

You can now create a payroll item. Let me know if there’s anything I can help concerning payroll.

Resolution for Issue 'How do I set up a Negative Deduction?' available: Yes (Solved).
Source: Intuit Community forum.

How do I set up a Negative Deduction?: 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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