I added a new employee and the federal tax is showing "0" in the paycheck.

I can share some information on how we calculate federal taxes, lisamoran. 

Our tax calculation is derived from the payroll data your employer has entered in QuickBooks. We calculate the federal withholding based on these factors:

• Taxable wages
• Number of allowances/dependents
• Pay frequency
• Filing status 

It's also possible that you've set the employee to Do Not Withhold for federal and state income taxes in the employee setup. To check: 

1. Go to the Payroll menu and then Employees. 
2. Select the name of the employee and click the edit (pencil) icon beside Pay. 
3. Next to the withholding section, select the edit (pencil) icon.
4. Check the Federal Filing Status/State Filing Status. 

Check these articles for more information:

• Form W-4: Employee withholding allowances
• 0.00 or no income tax withheld from paycheck
• Federal and state income tax

Should you need further assistance with payroll, feel free to drop us a comment below. We'll get back to you as soon as we can. Take care!

I just switched to quick books desktop and was having this problem.  As it turns out I had my payroll schedule set to annual instead of biweekly.  Not sure if that helps but another place to check!

It's great to see you here, @ibpeterson.

I would like to share some insights on how to resolve this paycheck withholding discrepancy. Regardless of the payroll schedule, taxes should calculate when you enter their gross pay. This is if they are not exempted from the federal axes. See this annual employee for example:

There are a few reasons why taxes won't calculate properly on the paychecks, especially the federal withholding. Consider the following:

• QuickBooks is not updated, or an internet interruption occurred during the update.
• Using an incorrect tax table version.
• Employee's Year-To-Date is incorrect.
• QuickBooks is doing a catch up for an underpayment or overpayment.

To correct this, let's make sure you're able to download the latest tax table update version 22116. You can check that by following these steps:

1. Go to the Employees tab.
2. Select Get Payroll Updates.
3. You'll see the tax table version beside the Payroll Update Info button.
4. Click on Download Latest Update if the update version is not correct. An informational window appears when the download is complete.

Next, review the status of the Payroll if it is showing active in the company file. Here's how:

1. Go to the Employees tab and select My Payroll Service.
2. Pick Manage Service Key from the list.
   
3. In the Status column, verify if it says Active.
4. You can also view your subscription status by pressing Ctrl + K on your keyboard.
5. If the status says Active, click the Edit button.
   
6. Click Next.
7. Uncheck the Open Payroll Setup - I want to start right tick box.
8. Click Finish.

If it's correct, review any discrepancy on the employee's paycheck. We can use a Payroll Detail Review report to verify the taxes withheld and the difference. Here's how:

1. Go to the Reports menu, and pick Employees & Payroll from the list.
2. Select Payroll Detail Review.
3. At the top of the report, click on Customize Report button.
4. From the Display tab, select a date range from drop down list or fill out the From and To dates.
5. Proceed to the Filters tab. Find Payroll Item from the list and tap Multiple payroll items. (See screenshot.)
   
6. Select the taxes that are not calculating. (Example: Medicare Company, Medicare Employee, Social Security Company and Social Security Employee).
   
7. Once done, click OK twice.

On the report, review if the payroll checks have the correct deductions. You can get the correct calculation by multiplying the total wage base of each payroll item by the corresponding tax rate.

If QuickBooks did overwithheld any taxes, you can wait for the next payroll run for QuickBooks to auto-correct the calculations. Another option is creating a liability adjustment to correct the taxes. Here's an article with the complete steps on how to create an adjustment: Adjust payroll liabilities.

Once done, try to process the payroll again and see if the taxes withhold correctly. If not, I highly recommend contacting our Payroll Support this time to report the problem.

Here's how you can connect with us:

1. Open QuickBooks.
2. Go to Help, then select QuickBooks Desktop Help.
3. Select Contact Us.
4. Enter your concern, then select Continue.
5. Choose a way to connect with us:
   • Post a question and get an answer from expert and other customers.
   • Start messaging with a support expert.
   • Get a callback from an expert (availability may be limited).

You can also chat our support online. Select your product and fill out the form to chat with an expert by clicking this link here: Do It Yourself Payroll Chat Support

If you need further help or have other questions with the payroll tax calculations in QuickBooks. Leave a comment below and I'll be glad to help. Have a productive week! Take care.