We have 5 separate L&I risk classifications that we use and each have different amounts. They are listed under payroll items and are paid quarterly. The problem is, some are not accruing correctly. They are thousands off so it constantly throws off our payroll liabilities owed. They are all set up the same way and a few accrue correctly. Does anyone have insight on this or have the same issue? Anyone have a fix solution? Thanks!
Thanks for getting back to the Community, Paulaatgsconcrete,
I want to ensure your L&I payroll liabilities accrue correctly in QuickBooks Desktop.
Technically, if you're able to set the payroll item correctly, it should calculate the correct amount on your employee's paychecks. Please be reminded that the Washington Labor and Industries (L&I) tax in QuickBooks Desktop is calculated based on the hours on paychecks.
In your case, since some of the payroll items are not deducting correctly, you'll need to review if your employee's L&I rate and hours are entered correctly on your employee's profile or transactions.
Please check out this article to know more about the Washington L&I tax set up: Set up a Payroll Item for Washington's Labor and Industries (L&I) Tax
Let me know how this goes, Paulaatgsconcrete. I'm here to help you get past this issue.
Thank you for the article! I did check the set up and it is set up correctly.
When we have an employee who is on KOS/L&I (keep on salary), Vacation or Holidays, we do manually remove the tax for those days in that pay period. We've been advised it's not necessary to charge for an employee who is not physically working. This could be a part of the problem, but definitely not all of it. I did call QB helpline and they said there is not a feature where we can only apply these taxes to a specific labor charge, they all will be taxed.
Any further thoughts or ideas I can try?
Hello again, Paulaatgsconcrete.
Thanks for turning to the Community about the L&I liabilities not accruing correctly.
To make sure I’m on the same page, I need to gather more information about the issue. What specific taxes do you manually remove during vacation or holidays?
Are you referring to the L&I company contribution or employee’s deduction? I appreciate any details you can provide.
Looking forward to hearing from you. Thanks in advance.
The L&I tax as applied to all hours worked whether it be labor, KOS, vacation or sick hours. The state requires the tax to only be accrued on physical hours worked, not on the rest. For example, when an employee takes 40 hours vacation, the tax accrues on that amount. When it comes time to pay quarterly taxes, the amount has then been calculated wrong because it taxed those vacation hours. Or if I have an employee on KOS, they aren't working, yet it taxes those hours as well.
I can't seem to find a way to only apply this tax to a specific labor payroll item. Or am I just supposed to adjust payroll liabilities just before filing quarterly taxes? Which is a lot of work to go back 3 months and calculate what was only physical labor. I hope you have some insight! Thanks!
For this: "I can't seem to find a way to only apply this tax to a specific labor payroll item."
You will see if and what you control, by Edit Payroll Item. Example:
Edit the Tax item to see how it is defined and what you can control. An Other Tax, for example, has a screen for : Select the items that will increase wages for this tax (= What is this computed against?). For some Addition/Deduction items, it reads differently: "that are almost always affected by this payroll item."
Also, some allow you to enter a Quantity or value in Paycheck Details, so you would view the details and refine the paycheck. Example: I took 8 hours sick and worked 32, and you cannot set it up to compute only n Worked Time, but you can view Paycheck Details during the second step, and change my Quantity to what you see in my Worked Hours payroll entry.
Hope that gives you some ideas.