Employer 401(k) contribution that's not a match

SarahCO · ‎December 31, 2024

I'm trying to get our new retirement plan set up in Quickbooks, and our company is providing a contribution to all employees that's not a match. Regardless what the employees have chosen to have deducted from their paycheck (even if it's 0%), our company is contributing to everyone a set % of their paycheck amount. How do I enter this? I want to make sure it's not dependent on the employee contributing the same amount.

Erika_K · ‎December 31, 2024

Thank you for providing a detailed description of your concern, SarahCo. Let's work side-by-side to ensure you can set up your employees retirement plan.

Since your company is providing a contribution to all employees that isn't a match, you'll need to create a different payroll item for each employee and customize it accordingly. I'll guide you on how:

On the left navigation panel, choose Payroll and Employees.
Select each employee on the list.
Choose Start or Edit in the Deductions & Contributions section.
From the Edit deductions and contribution, click + Add deduction/contribution.
Select + Add deduction/contribution from the dropdown menu and pick Retirement Plans for the Deduction/contribution type and 401(k) for the Type.
Scroll down and enter necessary details, including the different Employee deductions and Company contributions.
Click Save.
Repeat steps 2 to 7 for the rest of your employees.

I'm adding these articles that will help run your payroll reports to see your employees' current year-to-date data in the future:

Feel at ease to comment down below if you have other questions about 401k retirement plan contributions and deductions. I'll be here to ensure you have all the support you need.

View solution in original post

Erika_K · ‎December 31, 2024

Thank you for providing a detailed description of your concern, SarahCo. Let's work side-by-side to ensure you can set up your employees retirement plan.

Since your company is providing a contribution to all employees that isn't a match, you'll need to create a different payroll item for each employee and customize it accordingly. I'll guide you on how:

On the left navigation panel, choose Payroll and Employees.
Select each employee on the list.
Choose Start or Edit in the Deductions & Contributions section.
From the Edit deductions and contribution, click + Add deduction/contribution.
Select + Add deduction/contribution from the dropdown menu and pick Retirement Plans for the Deduction/contribution type and 401(k) for the Type.
Scroll down and enter necessary details, including the different Employee deductions and Company contributions.
Click Save.
Repeat steps 2 to 7 for the rest of your employees.

I'm adding these articles that will help run your payroll reports to see your employees' current year-to-date data in the future:

Feel at ease to comment down below if you have other questions about 401k retirement plan contributions and deductions. I'll be here to ensure you have all the support you need.

SarahCO · ‎January 07, 2025

Thanks for your help. I got it all entered and our first payroll run with the retirement. Yay! I do have one more question that I'm hoping you can answer. I need to figure out how to enter the withdrawal of the retirement contributions from our company account. Do I just enter that as a regular expense, or is there a way for me to link it to the amount that was taken out of each employee's paycheck? Thanks again for your help!

Aldren18 · ‎January 07, 2025

I'm pleased to hear that my colleague's guidance was instrumental in facilitating the initial payroll run for the retirement plan, Sarah. This marks a significant step forward. Now, let’s focus on entering the withdrawal of those contributions.

While there isn't a direct way to withdraw company contributions from the liability account where these contributions are recorded, there are a couple of effective options to accurately reflect this transaction in QuickBooks Online Payroll.

You can issue a check to decrease the amount in the contribution liability account. This approach allows you to record the withdrawal and ensures that your financial records remain accurate.

For detailed steps, here's how:

Navigate to the + New button and select Check.
From the Payee dropdown, choose the vendor you are paying.
From the Bank Account dropdown, select the account you use for liability payments.
Enter the Payment Date and Check Number.
From the Category dropdown, select the account you use to track your liability payments and then enter the payment amount.
Complete the remaining fields on the check, then select Save.

For more detailed guidance on these steps, I encourage you to check out this resource article, which provides a complete overview of the entire process: Pay your non-tax liabilities in QuickBooks.

Alternatively, you can create a journal entry to transfer the amount from the contribution liability account to a different account, such as an expense or your bank. This method is beneficial for tracking how much has been withdrawn for contributions.

Creating a journal entry for this kind of transfer offers greater flexibility for internal bookkeeping purposes. I recommend consulting with your accountant for guidance on proper debits and credits to use.

Additionally, I’d like to share some valuable articles that will assist you in managing your payroll deductions and journal entries effectively:

I also suggest utilizing the QuickBooks Payroll service. It offers access to certified QuickBooks Payroll experts who can provide personalized help with payroll tax queries anytime. This service helps manage payroll tax filings and employer contributions efficiently.

This channel is always open for any inquiries and concerns you may have in the future. If you have anything else you'd like to discuss in this forum about retirement contributions, please share it below. The Community team and I are excited to help you navigate, ensuring precise record-keeping.

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Employer 401(k) contribution that's not a match