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sheone25
Level 1

No medicare withholding

A former employee came back to work with us during this last quarter. Somehow the medicare box under the tax tab became unchecked and no medicare taxes were withheld. This is reflected on his W2 and the draft 941. How can I correct this to make everything match for yearend?

9 Comments 9
MaryGraceS
Moderator

No medicare withholding

Greetings, @sheone25.

 

It's nice to see you in the Community. Allow me to help and walk you through in correcting the employee's Medicare withholding tax.

 

To start, let's make sure to select Medicare in the employee's profile.

 

Here's how:

  1. From the Employees menu, select Employee Center
  2. Double-click the name of the employee.
  3. On the left pane, select the Payroll Info tab.
  4. At the top right, click Taxes
  5. Click the Federal tab.
  6. Put a check on the Medicare box.
  7. Click OK.

After that, you can make a positive liability adjustment to the Medicare Company and Medicare Employee payroll items. To get the amount of the adjustment, multiply the paycheck's wage base and the Medicare's rate. Example: Total Earnings x 1.45%.

 

Once done, you can follow the detailed steps in this article: Adjust payroll liabilities.

 

If you need more help with the process, you can also contact our Desktop Payroll Team. They can do screen sharing and guide you through the step-by-step process.

 

You can follow these steps to get in touch with them:

  1. Go to this link https://payroll.intuit.com/support/contact/?infosrc=qs&service=16.
  2. Click Basic, Standard & Enhanced.
  3. Click Payroll.
  4. Click View Contact Info.

 These resources should help to get you on the right track for correcting your Medicare withholding.

 

I'm just a post away if you should have any questions. I'll be happy to help you out. Have a great rest of your week.

Anonymous
Not applicable

No medicare withholding

To complete this you either need to get the money back from the employee or attribute it to wages, as paying employees taxes for employees is like income to them.

qbteachmt
Level 15

No medicare withholding

If the employer is going to Cover this as Wages or any expense, that is further Taxable income to them, so the Adjustment function would not be used; it needs to be on a 2018 paycheck as taxable Bonus.

Jazzy Gal
Level 1

No medicare withholding

It is Mar 15, 2020, and I know there has been a lot of talk about not withholding payroll taxes in light of the coronavirus crisis, but I didn't think it had been implemented.  Today I went to issue payroll checks after downloading the latest payroll update, and no medicare and social security are being withheld.  All employees have these boxes checked under TAXES, so I know that's not the problem.  How can I fix this?


Jazzy Gal

Kristine Mae
QuickBooks Team

No medicare withholding

Good job for checking the employees' profile and for updating the tax table, Jazzy Gal. I can think of one thing why these taxes are not calculating.

 

It may be the Social Security and Medicare taxes were over withheld on the previous paychecks. Let's pull up the Payroll Detail Review report and review if the checks have correct deductions. We can get the calculation by multiplying the total wage base of the payroll item to the corresponding rate.

 

Here's how to pull up the report:

  1. Go to Reports.
  2. Go to Employees & Payroll, then select Payroll Detail Review.
  3. Click Customize Report, then go to the Filters tab.
  4. In the Search Filters field, enter and select Payroll Item.
  5. Under Payroll Item, select Multiple payroll items.
  6. Select Medicare CompanyMedicare EmployeeSocial Security Company and Social Security Employee
  7. Click OK twice.
  8. Change the dates, then click Refresh

If QuickBooks over withheld these taxes, we have two options to fix the situation:

  • Option 1: Apply the taxes to your next paycheck. QuickBooks has an automatic calculation feature for rate-based taxes. 
  • Option 2: You can offset the overpayment by creating a liability adjustment.

You can get back to me after trying the recommended steps. I'm here to help you with the payroll calculations. 

tami5
Level 2

No medicare withholding

Doing payroll this week and Social Security and Medicare not calculating for anyone.  It is not an issue of over withholding.  Is there a reason?  I can't find anything in the stimulus bill regarding this.

BettyJaneB
QuickBooks Team

No medicare withholding

Thanks for joining us here in the Community, @tami5.

 

I'm here to ensure that your Social Security and Medicare of your employees will calculate correctly so you can run payroll successfully.

 

There are reasons that can lead to SS and Medicare not to calculate. These are the following:

  • QuickBooks is not updated or there is an internet interruption during the update.
  • Using the incorrect tax table version.
  • The gross wages of the employees last payroll are too low.
  • Total annual salary exceeds the salary limit.

If the issue persists after updating QuickBooks and the tax table, I suggest reviewing your employees' profile to see if their taxes are set up correctly. QuickBooks calculates the federal withholding based on these factors:

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

To review your employees’ payroll information:

  1. Go to Employees menu at the top.
  2. Choose Employee Center.
  3. Double-click the employee’s name, one at a time.
  4. Select Payroll Info on the left.
  5. Please make sure the Pay Frequency is correct.
  6. Click the Taxes button.
  7. In the Federal tab, review the Filing Status and Allowances fields. Make the necessary corrections.
  8. Hit OK.
  9. Click OK again.

Once verified that the info is all correct, you can run the Payroll Detail Review report as suggested by my peer, Kristine Mae above. This helps us check if there are any discrepancies for the SS and MD amounts on the employee's paycheck, which can be the reason they're not calculating.

 

On the other hand, you can also try reverting the paychecks that you've created to refresh its tax calculation. 

 

To do that, right-click on the paycheck, then press on Revert Paycheck (please see screenshot attached for reference). Once completed, re-enter the paycheck details to verify taxes are calculated correctly.

 

For additional reference about this action, read this article: How to save or revert pending paychecks.

 

You can also check out this link I've added to learn more about how QuickBooks calculates taxes:

Let me know if you have further questions about this or any concerns with QuickBooks. I'll make sure you're all set. Take care!

princessarayata
Level 2

No medicare withholding

Hello can you please tell me how to fix it in Quickbooks online? I am having the same problem. I also cannot see the SS and medicare mapped in my Payroll settings.

Kristine Mae
QuickBooks Team

No medicare withholding

It looks like the employees are set up as tax-exempt, Princessarayata. Let's go ahead and check their profiles.

 

Here's how:

  1. Click Payroll.
  2. Go to the Employees tab.
  3. Select the employee to open their profile.
  4. Click the Pencil icon next to Pay.
  5. Under What are Employee's withholdings?, click the Pencil icon.
  6. Go to Tax exemptions, then uncheck the SS and medicare box.

Although, if you're unable to check the settings, you might have the Full Service Payroll. I'd suggest reaching out to our payroll specialist to check your settings. Here's how:

  1. Click the Question mark icon or Help inside QuickBooks Online.
  2. Select Contact Us.
  3. Enter "SS and medicare not mapped" in the description box, then click Let's talk.
  4. Select either Get a callback or Start messaging

Also, they can create payroll adjustments to correct your taxes.

 

Drop by anytime if you have other payroll concerns. Take care!

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