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Level 1

Health Insurance Employee Deduction

Just started Quickbooks a few months ago and have been busy getting everything set up.


I have entered my employee's semi-weekly health insurance deduction through payroll setup. I would like to post this deduction to an expense account called Health Insurance Premiums. The remaining amount would be the employer's health care expense.


Under Payroll Settings - Accounting Preferences, it appears as if I can only post the employee deduction to a liability account. Is this correct? The deduction I created is only listed under "Other Liabilities & Assets". I also see the options "Employer Health Premium" & "Health Ins. Contribution Account", but they seem to only be for recording the employer's cost.

1 Comment 1
QuickBooks Team

Health Insurance Employee Deduction

Welcome aboard to the Community, gpthrush.


The employee deduction is posted to the Other Liability & Asset Accounts. Meanwhile, the employer part is tracked to the Company Contribution Expense Accounts.


Let me guide you through the steps on how to categorize these payroll items. Here’s how:


  1. Tap the Gear icon at the top to select Payroll Settings under Your Company.
  2. On the Accounting Preferences page, go to the Company Contribution Expense Accounts section and then mark the radio-button for I use different accounts for different groups of company contributions.
  3. Click the drop-down for the health insurance item and pick the correct expense account you want to use.
  4. Scroll down to the Other Liability & Asset Accounts to select the appropriate liability category for the health insurance.
  5. Click OK to continue.
  6. Then, hit the OK button and then enter the starting date when you want to update the information.
  7. Press OK to keep the changes.  

For more insights about classifying payroll items in QBO, check out the Setup Payroll account preferences article. It outlines the steps on how to set up a payroll account.


Keep me posted if you have any other concerns or questions. I'm more than happy to answer them for you. Have a great rest of the day.

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