cancel
Showing results for 
Search instead for 
Did you mean: 
Announcements
m9437
Level 1

W4- Form, Not Calculating Federal Taxes

I have an employee that used the new W4 form, is married filing jointly, and claiming 2 dependents. We've had 4 payrolls now and not a penny of federal taxes have been withheld. I've already verified everything is set up correctly about 10 times. If I play around with the hours worked/ wages, it starts taking out federal taxes at around $2400 or so. My question is, if the employee doesn't make that much for each payroll, will they have any taxes taken out? That seems like a lot of money, after a year to not have had to pay a single penny of taxes on. (Almost 60k, that would all be tax free?) That doesn't seem right. Can someone explain, or let me know at what point of gross wages, quickbooks will start taking out federal taxes? My employee keeps asking why none are being taken, and I don't know what to tell them. They don't want to be responsible come tax time to have to pay in to the federal gov taxes on 60k because quickbooks didn't do its job. 

1 Comment 1
jamespaul
Moderator

W4- Form, Not Calculating Federal Taxes

Hello, m9437.

 

I appreciate all the details you added regarding the federal tax issue. I'll shed some light about it and find out what's preventing QuickBooks from calculating the tax.

 

QuickBooks Desktop Payroll uses the wage bracket table to calculate the federal taxes. Depending on how much they earn per payroll, you might want to check where they fall under the bracket. 

 

You can check this IRS publication about the wage bracket calculations: https://www.irs.gov/pub/irs-pdf/p15t.pdf.

 

Another thing to look out for is the gross wage. It's likely that the wages are too low for QuickBooks to calculate the tax. This is normal, provided that the employee's tax setup and hours worked are correct. 

 

In addition, pre-tax deductions can affect how the federal taxes are calculated. 

 

This article can explain more about how QuickBooks calculates the taxes: How QuickBooks calculates payroll taxes.

 

After getting the information on the federal taxes, I'm sure you have other tasks to complete. If you need a guide or two, our articles can definitely help you out. 

 

I'm willing to share a thing or two if you need help completing your tasks in QuickBooks. Just post the details here and I'll get back to you as soon as possible. 

Need to get in touch?

Contact us