QB Issue Resolution:
“Also, technically this is an employee benefit, so I’m not sure how that factors in. Could it be recorded under an employee benefit expense like healthcare?”
This is the Most Important piece of the puzzle, actually.
“My thought was to create an Other Expense account called “lost revenue”, where should I go from there?”
No. Here is what you have:
You are asking about tracking Gross. Gross income and gross as 100% write off. But, this is not Written Off. It is Offered to the employee as a working fringe benefit and falls under the child care rules or taxable fringe or might be under a Nontaxable benefit rule.
So, the Tuition is charged to the employee using a Customer Name version. Then, create an Other Charge Type Item linked to Employee Loan (other asset) and use this on the Credit Memo to apply to the invoice.
Now you have an amount “parked” for each employee name, and the Customer Names = 0 owed.
In Payroll, you will have an Employer Company Contribution (other addition) item, if you use Desktop Payroll. The Expense account side links to Employee Fringe Benefit (this is the Debit side) and the Liability side links to the Employee Loan account (this is the Credit side, so it acts like a Loan Repayment Process).
Your amount to put through payroll is this amount you “wrote off” for services offered to them.
Make sure to use the Tax Tracking item that applies, such as Child/Dependent Care for W2 box 10, and you need to manage the limits that apply, if any. We don’t know if this qualifies for Tax free, if they have FSA, etc. We also don’t know if this person gets Subsidies from the County or State.
You should get some guidance from your own CPA.
And reconcile that Employee Loan account to an ending balance of 0, and clear ONLY the activities of each person when their “employee name” = the Customer Name to a closing difference of 0. That is how you confirm the amount written off has also been run through Payroll.
Resolution for Issue 'I work for a school that gives staff free tuition for their children. How can I record the lost income that would have been received if the spot went to a paying child?' available: Yes (Solved).
Source: Intuit Community forum.
I work for a school that gives staff free tuition for their children. How can I record the lost income that would have been received if the spot went to a paying child?: 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 benefit rule
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