Child Support paid by owner through third party payroll

Rose H · ‎March 21, 2019

How do I book the owner's payroll deductions for child support in QuickBooks?

Is this a payroll expense for him or a liability since he owns the company?

JaneD · ‎March 21, 2019

Hi there, Rose H.

Thanks for joining the Community. I'm here to address your concern with recording a child support in QuickBooks.

If you want to show child support deductions on owner's W-2 Form, record them on the paycheck in QuickBooks Desktop. If you don't have a payroll subscription, you can set up payroll in a few easy steps.

Let me show you how:

Make sure that your preferences are set up for payroll.

• From the Edit menu, select Preferences.
• On the left pane, choose Payroll & Employees, and then go to the Company Preferences tab.
• Click on OK.
From the Help menu, choose QuickBooks Help (or press F1 on your keyboard).
In the Help Search field, type in manual payroll, and then press Enter.
Select the Process payroll manually (without a subscription to QuickBooks Desktop Payroll) topic. Then, click on the manual payroll calculations link.
Select the Set my company file to use manual calculations link. (Note: When your company file is set up for a manual payroll computation, QuickBooks inserts a zero amount for each payroll item associated with a tax.)
Click on OK to confirm.
Close and reopen QuickBooks.

As a reference, you can also check out this article for further guidance: Set up payroll without a subscription.

Note: For the owner's payroll, that would be an expense and at the same time, a liability for the business.

Then, follow the steps in this article to set up a payroll garnishment: Child Support.

Once done, you are now ready to create paychecks. Just go to Employees, choose Payroll Center, and select Start Unscheduled Payroll.

You can check out this article for the detailed steps: Create paychecks.

This should point you in the right direction. Please let me know if you have further questions. I'm always here to answer them. Have a wonderful day.

View solution in original post

JaneD · ‎March 21, 2019

Hi there, Rose H.

Thanks for joining the Community. I'm here to address your concern with recording a child support in QuickBooks.

If you want to show child support deductions on owner's W-2 Form, record them on the paycheck in QuickBooks Desktop. If you don't have a payroll subscription, you can set up payroll in a few easy steps.

Let me show you how:

Make sure that your preferences are set up for payroll.

• From the Edit menu, select Preferences.
• On the left pane, choose Payroll & Employees, and then go to the Company Preferences tab.
• Click on OK.
From the Help menu, choose QuickBooks Help (or press F1 on your keyboard).
In the Help Search field, type in manual payroll, and then press Enter.
Select the Process payroll manually (without a subscription to QuickBooks Desktop Payroll) topic. Then, click on the manual payroll calculations link.
Select the Set my company file to use manual calculations link. (Note: When your company file is set up for a manual payroll computation, QuickBooks inserts a zero amount for each payroll item associated with a tax.)
Click on OK to confirm.
Close and reopen QuickBooks.

As a reference, you can also check out this article for further guidance: Set up payroll without a subscription.

Note: For the owner's payroll, that would be an expense and at the same time, a liability for the business.

Then, follow the steps in this article to set up a payroll garnishment: Child Support.

Once done, you are now ready to create paychecks. Just go to Employees, choose Payroll Center, and select Start Unscheduled Payroll.

You can check out this article for the detailed steps: Create paychecks.

This should point you in the right direction. Please let me know if you have further questions. I'm always here to answer them. Have a wonderful day.

Rose H · ‎March 21, 2019

Thank you Jane D!!!

Very informative!

JaneD · ‎March 21, 2019

You're welcome, Rose H.

I'm glad I came across your post and was able to address your concern. If you ever have any other questions we can help you with, feel free to drop by the Community. Take care.

SJ_19 · ‎April 21, 2019

I have a quick couple of questions about what to do if it is the owner of the business paying his child support. If the owner of the company recently started paying his child support from the business account, what would I need to list it under on the books and would I classify his former spouse as an “other”, since she isn’t an employee, vendor, or customer?

AlexV · ‎April 22, 2019

Thanks for joining the thread, SJ_19.

In classifying his former spouse, you can use "Other". In addition, we need to make sure that you'll use the same expense account in creating a check for the child support as what you've used in when you set it up. This way, you can easily track it.

If you haven't set up the child support, you can follow this article: Set up a payroll garnishment item.

You can always reach out to us here if you have other questions.

SJ_19 · ‎April 23, 2019

That's where I ran into the issue. His child support doesn't get paid through a third party. They had it setup to where it gets paid directly to her; no child support enforcement agency, no garnishments, no third parties, etc., which I found to be a little surprising.

In this unique situation, how would one go about deciding the account and account type to place this under? Would you create an account just for this payout? Would it be better to list it as an expense or a liability?

goredeye · ‎March 16, 2023

I am in the same situation now. how did you resolve your issue and record child support paid directly to the parent?

goredeye · ‎March 16, 2023

hi were you able to figure how to record ? i am in similar situation i(business owner) paid child support directly to my exwife from the business account to her account. now im not sure how to post these transactions

Just_me · ‎March 16, 2023

@goredeye There are steps showing, plus a link, to guide you through this. All you have to do is read it.

"If you haven't set up the child support, you can follow this article: Set up a payroll garnishment item."

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Child Support paid by owner through third party payroll