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Owner paid employee $500; no taxes withheld - how to record on QuickBooks

The owner decided to pay an employee a bonus of $500. He sent the money from a payPal account. How do we record this in QuickBooks to be included in the employees W2? I believe it needs to be grossed up and all the appropriate taxes need to be recorded.

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QuickBooks Team

Owner paid employee $500; no taxes withheld - how to record on QuickBooks

Hello there, TCG.


You can create a separate bonus check to record the amount provided to your employee. Since there were no taxes taken out, you can select the option As Net Pay for the system to figure out the total pay.


Here are the steps:

  1. On the left panel, click Workers.
  2. From the Employees tab, click the arrow next to Run Payroll.
  3. Select Bonus Only.
  4. Under How would you like to enter your bonus amounts?, choose As Net Pay.
  5. Click Continue.
  6. Select the employee's name, and enter the net amount on the Net Bonus box.
  7. Click Preview Payroll.
  8. Click Submit Payroll.

You can also check this article for more information: Create Bonus Checks Only.


If you have any additional questions or concerns about QuickBooks, feel free to let me know. Thanks.

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