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I need to manually prepare payroll in Quickbooks Online. I will do the taxes calculation manually as well. How should I set this up on QB?

 
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Best answer 10-15-2018

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Super Contributor *

You will have to use journal entries: https://community.i...

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Super Contributor *

You will have to use journal entries: https://community.i...

gdc
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Re: I need to manually prepare payroll in Quickbooks Online. I will do the taxes calculation manually as well. How should I set this up on QB?

I do manual payroll in QB.  First step input the hours accordingly.  Second step, I set up an excel spreadsheet to help calulate federal, state, city, and school.  I record those amounts on the timecard and manually added them in QB in the appropriate area.  We have been doing this since 2005 with no problems.  No Journal Entries necessary and the W2 print fine

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Re: I need to manually prepare payroll in Quickbooks Online. I will do the taxes calculation manually as well. How should I set this up on QB?

Where is the appropriate areas?

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Re: I need to manually prepare payroll in Quickbooks Online. I will do the taxes calculation manually as well. How should I set this up on QB?

What are the appropriate areas?

QuickBooks Team

Re: I need to manually prepare payroll in Quickbooks Online. I will do the taxes calculation manu...

Hi there, @EXR007.

 

Thanks for keeping in touch with us to resolve your concern. I have some information on how you can manually prepare payroll in QuickBooks Online.

 

While I'm not familiar with how gdc works his way to manually do payroll, here's what I know what appropriate areas are: Gross Pay, Net Pay, Deductions, Taxes Withheld (Employee and Employer taxes), Other Pay, Paid time off, etc.

 

On the other hand, manually creating payroll can also be done using a Journal Entry.

 

Here's how:

  1. Go to the Plus icon.
  2. Under Other, select Journal Entry.
  3. Choose the date of the paycheck.
  4. Enter the number for the journal entry. You can choose any number for the journal entry, as this is simply for reference purposes and doesn’t affect the actual entry.
  5. Enter the appropriate debit and credits for the account.

While doing this, I'd recommend consulting an accountant on which specific accounts to use in recording the transaction to ensure the best accounting for your personal business.

 

For a more in-depth information on this matter, check out this article: https://quickbooks.intuit.com/community/Employees-and-payroll-taxes/Record-payroll-transactions-manu....

 

Keep in mind that you can also use a third-party payroll service, in which case you’ll need to contact the service to give them the appropriate information. You may search the web, visit Apps.intuit.com, or click Apps in QBO to look for a third party application which will integrate well with the program.

 

You should be able to prepare payroll for your employees with the above information. Let me know how things go and if you have other questions with QuickBooks payroll. I'm always here to help. Have a great rest of the week.

Established Community Backer ***

Re: I need to manually prepare payroll in Quickbooks Online. I will do the taxes calculation manually as well. How should I set this up on QB?


@gdc wrote:

I do manual payroll in QB.  First step input the hours accordingly.  Second step, I set up an excel spreadsheet to help calulate federal, state, city, and school.  I record those amounts on the timecard and manually added them in QB in the appropriate area.  We have been doing this since 2005 with no problems.  No Journal Entries necessary and the W2 print fine


This may be for QB Desktop. The question is for QBO, where this answer does not make sense

Frequent Contributor *

Re: I need to manually prepare payroll in Quickbooks Online. I will do the taxes calculation manually as well. How should I set this up on QB?

If you have 20 or fewer employees, the following method works for Quickbooks online:

* Add check for each employee  (Plus icon, add check) as follows:

*Put employee name in payee field (add as vendor or employee)

*Add expense category: Gross Wages, input gross wages as a positive number in the amount.

*Add liability category: Federal Income Tax Withheld or Payroll Liabilities, input tax withheld as a negative number.

*Add liability category: Social Security Tax Withheld or Payroll Liabilities, input tax withheld as a negative number. 

*Add liability category: Medicare Withheld or Payroll Liabilities, input tax withheld as a negative number. 

*Add liability category: State Tax Withheld or Payroll Liabilities, input tax withheld as a negative number. 

*Add liability category: Workers Comp Withheld or Payroll Liabilities, input tax withheld as a negative number. 

 

To record the employer taxes, you would either wait until you actually pay the taxes to record the Payroll Tax expense (cash basis) or record the Payroll Tax expense with every payroll as it is calculated (accrual basis). To do this requires a journal entry:

Payroll Tax expense (debit)

Payroll Tax Employer Payable (credit)

 

When paying the employees share of these taxes to the tax entity, you would write another check to the tax entity with Payroll Liabilities, or the correct category, as a positive number, and employer Payroll Tax expense as a positive number (if using cash basis) or Employer Payroll Tax Liability (if using accrual basis) as a positive number.  

 

If you have more than 5 or 10 employees, you may want to save yourself a lot of time and use Quickbooks Online payroll or another outside payroll service with general ledger export capabilities.  

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