Does quickbooks calculate state unemployment on retirement and health payments

Thank you for taking the time to post your concern here in the Community, JeneaneS. 

QuickBooks calculates the SUI tax based on the setup in your payroll product, considering the taxable wage base and SUTA tax rates. If the SUI shows 0.00 on a paycheck, it could be because the employee has reached the SUI wage base limit or is marked exempt from SUI.

If the SUI is showing 0.00 on recent paychecks but was calculated correctly on previous ones, it may be because the employee has already reached the SUI wage base limit.

You can check and update your tax exemptions if needed in your payroll product. Here's how:

For Employee:

1. Go to Payroll, then select Employees.
2. Under Tax withholding, select Edit.
3. Review the SUI checkbox and correct if needed.
4. Hit Save.

For Employer: 

1. Go to Settings, then Payroll settings.
2. Select Edit next to your state.
3. In the Unemployment Insurance (UI) section, select Edit.
4. Hit Continue.
5. Review the rate and effective date, then update if needed.
6. Click Save, then Done.

You can also check with your state agency to verify if retirement and health company contributions are taxable for SUI. For further assistance, I recommend getting in touch with the Payroll Support team. They have all the required tools to properly update your SUI tax rate.

Additionally, you can learn how to set up a retirement plan deduction or a company contribution and how payroll taxes are calculated in QuickBooks Online to track and tax it appropriately.

If you need further assistance with your payroll taxes, running reports, or anything else, feel free to add your reply below and I'll circle back to help you.

Thank you for your answer. I have done what you suggested (it's for Employer only) but that has not changed the reports. Does QB do this retrospectively or only on reports going forward?

Also, do I have to change the effective date on a regular basis? The effective date was 1st January 2023, I changed it to 1st January 2024 but there were other options. How often should I change this date?

I thank you for your continued support.

Kind regards

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Let me clarify how the payroll service handles the items mentioned above and direct you to the right support that will guide you in handling your concern about changing the effective date, JeneaneS

You'll not notice any changes on the reports, whether retroactively or in the future. Thus, retirement plans and company-paid health payments are not subject to the state unemployment tax.

In addition, changes will be based on the dates entered in the Start date and End date fields in the Update transactions window. You may want to consult with a tax adviser about how frequently you'll have to change the effective date. Getting in touch with them will help ensure the information on your payroll reports, taxes, and forms is accurate.

For additional reference, let me share this article that outlines the steps to manage your payroll accounting settings: Change your accounting preferences in QuickBooks Online Payroll.

In case you'll have to add a health savings account, manage your employee payroll deductions, and keep track of your payroll data, click on the links below for full details:

• Set up a Health Savings Account (HSA) item in QuickBooks Payroll
• Set up, change, or delete employee-paid payroll deductions
• Create and manage reports

Keep me posted if you have other payroll-related concerns or questions. I'll get back to provide the assistance you need.