AL OT Withholding exemption

Hello there, @Meggille. I know why the payroll items are still withholding taxes when writing a check in QuickBooks Desktop (QBDT).

QuickBooks is currently working on implementing the new taxation requirement for this compliance change. We are aware of this and are working on implementing it. Since the changes haven’t rolled out to the product, setting up this item for Withholding Exemption won’t take effect until such time. 

Rest assured that users will be communicated when the ability to set up and track this new Alabama requirement becomes available in QBDT. Once available, you can get the latest tax table update to stay compliant with paycheck calculations.

If you have any further inquiries about payroll items, feel free to continue this conversation. Please note that the Community is available at all times to provide you with assistance. Stay well!

When is this update going to happen?????

Hi there, @Meggille.

We want to assure you that we are actively working on implementing the new Alabama overtime rule changes. While we work on this, you can proceed with setting up the payroll item. However, please keep in mind that the overtime exemption will not take effect yet.

I understand the inconvenience this must have caused you and your business. While we can't provide a specific time frame for when updates will take effect, I recommend contacting our Customer Care Team. They are well-equipped to provide real-time assistance and ensure the accuracy of your calculations.

Here's how to reach us:

1. Go to the Help menu. Then, select QuickBooks Desktop Help/Contact Us.
2. Click Contact Us.
3. Enter a brief description of your concern. Then, hit Continue.
4. Sign in to your Intuit account.
5. Enter the code you'll receive in your Intuit email. Then, click Continue.
6. Choose to Chat with us or Have us call you.

You can check out their support hours here: Contact QuickBooks Desktop support.

When the update takes place, here's an article to guide you in setting up the Alabama overtime exemption: Set up and track Alabama overtime exemption.

If you ever need assistance with filing your taxes using QuickBooks, these resources will come in handy for you:

• Create and file 1099s with QuickBooks Desktop
• File your W-2 and W-3 forms

Should you have additional questions about filing your taxes or anything else QuickBooks-related, please let me know. Just leave a comment below and I'll get back to you. Have a great day. 

Again, this is USELESS and RIDICULOUS reply from QuickBooks!  Calling their Customer Services does absolutely nothing but waste our time.  Of the 6 people that I have now spoken with at QuickBooks over the last 2 days, not a single one of them knew ANYTHING about the Alabama overtime change/update.  It was finally a Manager that told me the update had not even been pushed out and would hopefully be today.  I truly don't understand why these responses keep telling us to call Customer Service, when it is known that the update is NOT working.  Why can't you simply tell these overworked and stressed out payroll customers the truth - that there is NOTHING they can do right now but wait on QuickBooks to send out the update???  

My payroll update is current, but when I run the Payroll Item Detail report, there are no OT wages listed.

I received an email saying this item won't show up on the paystub, you find it on the before mentioned report.

This is not true.

This is what we found. 

Sorry, website was having issues not letting me finish my post. This is what we found out: 

Well we finally figured out how to get the Alabama OT Exemption payroll item to work for us. Most of our clients use the 1.5 Overtime for all hours worked over 40 in a week. This is what we found that finally worked:

1. You must have the most recent payroll tax table installed and all software updates installed and up to date. This should be an easy task but is anything but. I have wasted hours trying to get software updates installed and not show pending. Just closing out of the software will not always get the newest pending updates to install. This is what I learned must be done to force the software to update. 

1(a). Right click on desktop shortcut and "Run as Administrator". Somehow this gets most of the updates installed but does not guarantee that it will. If this does not work, close out of all programs and restart your computer. Then right click shortcut on desktop to "Run as Administrator" again and see if it installs. You may have to Run as Administrator then check for updates several times before all the updates will install but they eventually will. 

2. Even though our OT payroll item was set up correctly using the 1.5 time regular hourly rate, somehow the payroll item was missing a property that was not communicating with the new "AL - OT Withholding Exemption" payroll item. We are guessing that somewhere along all these years, that the item got corrupt or is missing a link/property that helps the new Exempt wages payroll item from treating it as a true Overtime Wage. 

3. We had to create an all new OT Hourly Rate payroll item at 1.5 hourly rate for the new Exempt wages payroll item to recognize it as wages exempt from Alabama withholding. 

4. Any new wage payroll item set up will automatically be added to the AL OT Withholding Exemption. If you do not want a new payroll item to be subject to the exemption, edit the exemption payroll item to uncheck any Wages item that you do not want to apply to the exemption. 

5. All paychecks created since Jan 1st, 2024 that you had OT wages added, you will need to unlock the paychecks and edit the OT payroll item to include the new OT Hourly Rate payroll item you just created. If you do not use the new payroll item then the AL OT Exemption totals, will not include those wages from prior paychecks that it did not previously recognize as true OT Hourly Rate wages. 

6. If everything is working correctly, the state withholding amount will actually go down after you add the new OT Exempt wages. This I read is because QuickBooks state withholding takes in to account the federal withholding amount as a deduction when it calculates the state taxable wages.

7. Create a payroll item detail report that includes only the AL OT Withholding Exemption item. To do this, click on Reports > Employees & Payroll > Payroll Item Detail. Click button to Customize then click on the Filters Tab and select Payroll Item under the Search Filters listing, then click on the drop down list and select AL - OT Withholding Exemption. Click on Display Tab and Total by Employee and Sort by Source Name. This report will help you keep track of the dollar amount and number of employees that your will report on a monthly or quarterly basis. Just edit your date to include those wages you are currently reporting. I had more to say but obviously the website will not allow me to type anything more than this and since I am hoping this will help someone its the best I can do for now. Best of luck everyone.

We also found out on another client that the previous paychecks could not be edited to include the new payroll item for OT Hourly Rate. We had to literally delete all prior paychecks that had OT wages and reenter the paychecks using the new payroll item OT Hourly Rate in order for the OT wages to be reported correctly for reports and payroll forms. 

Makes no sense that we had to delete all the paychecks and couldn't just edit them but there you go. 

I created an all new OT Hourly Rate payroll item. But...it still doesn't connect for the new Exempt wage. It's not linked to the the New AL OT exempt wage

Hi,

Since the new Alabama OT rate still isn't linked to the new wage, I suggest reaching out to our phone support team so we can create an investigation about it.

To get in touch with them, you may follow these steps:

1. From the Help menu, select QuickBooks Desktop Help.
2. Click Contact Us.
3. Enter a few words to describe your issue.
4. Click Continue.

If you ever need assistance with filing your taxes using QuickBooks, you can check these articles:

• File your W-2 and W-3 forms
• Create and file 1099s with QuickBooks Desktop

I'm always around whenever you have concerns managing your employees.

Is there an update on the progress of the AL OT Withholding exemption?  Can QB please at least have the decency to keep customers updated since we have to report this information to the state??  We were told there was a solution before the year ended and there is not.  We have read all of the articles, spent so much time on the phone and chats and have had zero resolution.   Please let us know what we are supposed to do. 

Hi there, 123aa. I recognize the importance of staying up-to-date with the progress of the AL OT withholding exemption.

I understand that this situation has caused inconvenience for you and your business. We can't provide a specific time frame for when updates will take effect, but I guarantee you that we are working on implementing the AL OT exemption for QuickBooks Desktop. Rest assured that you'll receive communication and helpful information on the new requirement when this will be available. 

I recommend contacting our payroll support for further questions regarding the new AL OT exemption rule. Our designated team got all the necessary information regarding this. 

To reach our payroll support team:

1. Go to the Help menu and select QuickBooks Desktop Help/Contact Us.
2. Select  Contact Us.
3. Type a short description of your issue and concern in the box provided, then click Continue.
4. Sign in to your Intuit account, select Continue, and then Continue with my account.
5. You'll receive a single-use code in your email; enter the code and select Continue.
6. Select Have us call you.

For future reference, you can run a payroll report in QuickBooks Desktop to see a detailed summary of your company's payroll expenses, including employee salaries, bonuses, taxes, and other related costs. 

I appreciate your patience and understanding. You can return here anytime whenever you have other concerns. I'm always here to assist you.

Are you working in a single or multi user environment?