Make QuickBooks Payroll Tax Journal Entry

Step 1:  Follow the given instructions to make manual tracking accounts

In any case, if you still don’t have an account then first you need to make new accounts in the Charts of Accounts to navigate the payroll liabilities and expenses.

After making these expense accounts, the user has to choose the “Expense” option as an account type:

  • Payroll Expenses: Taxes
  • Payroll Expenses: Wages

To make the liability account, you need to choose the “Liabilities” as the account type:

  • Payroll Liabilities: Federal Unemployment
  • Payroll Liabilities: Federal Taxes
  • Payroll Liabilities: [State] SUI/ETT
  • Payroll Liabilities: [State] PIT/SDI

All the given accounts include most of the common payroll state of affairs. The user might need to make additional accounts for taxes specified in your state or location.

Step 2: Enter your payroll paychecks. After paying your employees outside of QuickBooks, you need to create a new journal entry

  • First of all, go to the payroll services and view the payroll report
  • Then click on the Select + New button to choose the Journal Entry
  • From the Journal date field, you have to enter the Paycheck data
  • If it is required to navigate the paycheck number, then enter all required details in the journal number field

To create the journal entry, you can pick the data from the payroll report. But if you paid various employees for the selected pay period. You can sum up all of their total checks totals in just one journal entry. In case, if you want to create separate journal entries for every employee then the user required to break out the data.

To add gross wages

  • Choose the “Payroll Expenses”
  • Click on the “Wages” section for the account
  • Fill the amount as a debit

To add employer payroll taxes

  • Choose the “Payroll Expenses”
  • Click on the “Taxes” for the account
  • Choose the option Amount as a debit

To calculate the paid taxes towards 941 or 944 taxes

  • Choose the Payroll liabilities  such as Federal taxes 941/944
  • Fill the amount as a credit

How to add state unemployment insurance taxes?

  • Choose the Payroll Liabilities: [State] SUI/ETT liability
  • Fill the amount as a credit 

To calculate the state income taxes

  • Choose the Payroll liabilities: [State] PIT/SDi
  • Now, enter your account as a credit

To add/calculate the federal Unemployment Taxes

  • Click on the Payroll liabilities
  • Pick the Federal Unemployment (940) for the selected account
  • Fill the amount as a credit

To compute net wages

  • Choose the Checking account that you are paying your employees
  • Rather than add them, the user needs to enter individual paychecks on the separate fields
  • The next thing you have to do to enter the amount as Credits

Once you are done entering the debits and credits then hit the SAVE button to update all new changes

Point to be Noted: You can add the following taxes in just one debit or sum up each item as separated debits such as Medicare employer, state job training taxes, social security employer, and state unemployment insurance.

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