A former employee came back to work with us during this last quarter. Somehow the medicare box under the tax tab became unchecked and no medicare taxes were withheld. This is reflected on his W2 and the draft 941. How can I correct this to make everything match for yearend?
It's nice to see you in the Community. Allow me to help and walk you through in correcting the employee's Medicare withholding tax.
To start, let's make sure to select Medicare in the employee's profile.
After that, you can make a positive liability adjustment to the Medicare Company and Medicare Employee payroll items. To get the amount of the adjustment, multiply the paycheck's wage base and the Medicare's rate. Example: Total Earnings x 1.45%.
Once done, you can follow the detailed steps in this article: Adjust payroll liabilities.
If you need more help with the process, you can also contact our Desktop Payroll Team. They can do screen sharing and guide you through the step-by-step process.
You can follow these steps to get in touch with them:
These resources should help to get you on the right track for correcting your Medicare withholding.
I'm just a post away if you should have any questions. I'll be happy to help you out. Have a great rest of your week.
To complete this you either need to get the money back from the employee or attribute it to wages, as paying employees taxes for employees is like income to them.
If the employer is going to Cover this as Wages or any expense, that is further Taxable income to them, so the Adjustment function would not be used; it needs to be on a 2018 paycheck as taxable Bonus.