Thanks for actively responding @Easyas12. I've read all your post on this thread to make sure I'm able to grasp the detail of your concern and effectively help you achieve what you're trying to accomplish. 

To answer your questions, you'll have to update first the taxability settings back to the default so it won't calculate the employer's portion, but only for the employee's portion of Social Security for your new FFCRA payroll items.

 Here's how: 

1. On the Employee menu, scroll down to the bottom and select Manage payroll items.
2. Select one of the National Paid Leave items you've set up, then select Edit payroll items in Payroll Item drop-down list. 
3. Select Next, till you reach to the taxability screen.
4. Select the Default button to unmark Employer Social Security. 
5. Repeat these steps for all of the National Paid Leave you've added.

Once done, you'll need to do these following tasks below before you can start paying your employees: 

• Determine your employee’s benefit and hourly rate
• Set up your expense accounts for the paid leave
• Set up payroll items
• Set up a new tax item

Then, follow the steps to delete, edit, and void the paycheck you've created prior to the latest update according to its status.

Additionally, read through this article: How to track paid leave and sick time for the coronavirus. It includes more detailed steps on the tasks I've listed above.

For future reference, learn about how to get the tax credits under the FFCRA after paying your employees paid leave or provide health benefits. 

Let me know if you need more help or if you have additional questions. I'm always around to back you up. Stay safe. 

Getting a little closer

But the checks created prior to the latest update which included tax on the company portion?

Can I edit the company portion or must I recreate the check?  Or are you saying changing the setup will fix the prior checks?

I do appreciate you for keeping us posted, Easyas12. 

If there are changes or updates on the company file, it won't affect previous transactions since QuickBooks doesn't retroact. We suggest that you can delete and recreate the paycheck you ran for the updates to take effect. Yes, you can also edit the paycheck. Let's just make sure that taxes are still correctly withheld after editing them. 

You can also run the latest payroll tax table before recreating or editing the paychecks to stay up-to-date.

I'll be attaching a reference that will help you in deleting, editing, or recreating the paycheck in QuickBooks Desktop: Edit, Delete, or Void a Paycheck. 

The Community is available 24/7. Just leave a reply and I'm here to help. Have a great day and stay safe always! 

Finally Catherine_B answers the question after it was asked 6 TIMES!

The rest of you should be ashamed.

Quickbooks is not figuring my medicare credits on the 941. Or maybe I am just not seeing the credit? Where should I look for this? 

Also, I set up (Step 4) a new tax item, but do not know how to use it? What is it's purpose?

I am finding the directions for setting up FFCRA paid leave complicated.  Is there a step by step set of directions to set this up in QB desktop that includes how to set up the accounts for employee and employer and then how to apply them to the employee who is receiving wages paid for FFCRA?  

Thank you.  Any help will be appreciated.

Hi Barbara1, 

Welcome to this thread. I'd be glad to walk you through setting up the FFCRA paid leave in QuickBooks Desktop. 

First off, ensure you're not set to pay the Employer Portion of Social Security for your new FFCRA payroll items. And that you are paying only the employee portion of Social Security. 

Here's how: 

1. Go to the Employee menu, then scroll down to Manage payroll items, Edit/view payroll items then select one of the National Paid Leave items you set up.
2. Select Next, until you come to the taxability screen, the select default button. This will set your taxability to unmark Employer Social Security.
3. Repeat for all National Paid Leave additions you set up.

Then, follow steps 2 through 4 to complete the set-up in this help article: How to track paid leave and sick time for the coronavirus.

For future reference, rea through this resource to learn about claiming your tax credits under the Family First Coronavirus Response Act. 

Feel free to visit again if you have additional concerns about FFCRA. I'd be glad to assist. 

Thank you, Katherine.  I have the hourly wage item set up in payroll and the expense category linked but when I go through the payroll item I am not seeing the taxability section.  It looks like QB payroll set up 3 payroll items:

CARES Co. Soc. Sec. Deferral

CARES Retention Credit

National Paid Leave Credit

Should I be using these?  

Thank you for your help.  

Barbara

Hello there, @Barbara1.

For this tax item, you'll need to set it up manually. This is the reason why you're not able to see it in the Taxes section. You can start with what my colleague mentioned. Then, link the Expense account you're going to create. You'll need to set up an expense account for the payroll item. Once done, you can now create the tax item and link it to the expense account you've made.

Here's how to create an expense account:

1. Go to the Lists menu and select Chart of Accounts.
2. Select the Account ▼ dropdown, then select New.
3. Choose Expense, then select Continue.
4. From the Account Type dropdown, select Other Expense.
5. Input an account a name, such as COVID-19 Expenses, in the Name field.
6. Select Save and Close.

After that, please refer to this article and follow the step - Set up payroll items until step 4-Confirm you have a new National Paid Leave Credit tax item, or set it up: How to track paid leave and sick time for the coronavirus.

I'd also recommend contacting your accountant to help you set it up and ensure that your books are accurate. If you don't have one, you can look for the accountants that also specialize in QuickBooks based on your location: Find an Accountant.

Just in case you need to delete a paycheck in the future, you can check out this article: Delete or void employee paychecks. This contains steps to help you with the process.
 

I'll be here if you have other questions. Feel free to tag my name in the comment section. Take care.