Payroll Increase before end of year

AndyM8 · ‎December 18, 2020

Hey all,

OK, I need to increase our payroll from $90,000 to $110,000 for 2020 but I only have one payroll left for the year, which is today.

I already increased the salary to $110,000 but I don't think QB payroll will automatically make up the difference between $90,000 and $110,000 before the end of the year.

So how can I ensure that the employee is paid $110,000 for 2020? Do I just to payroll as normal and then do a one-time lump sum payment before the end of the year or is there another way to make sure 2020 shows $110,000 for the employee?

As of today, his payroll will be $81,000 and change so a lot to make up between now and Dec. 31.

Thanks!!!

john-pero · ‎December 24, 2020

When you change a salary amount it is not retroactive and you cannot make it so to catch up. Are you certain the contract calls for the entire salary of 2020 to be 110k? Getting a raise in the middle of the year by itself does not guarantee an employee back wages for when they were paid less.

However, if you do have a contractual arrangement ON PAPER that this employee MUST receive $110k for ALL of 2020 then you can run an unscheduled payroll to make up the difference.

I would treat the $19k single check as BONUS pay which carries a mandatory flat rate federal withholding of 20% (you have to manually enter or override the calculated amount) rather than adding it as a regular one time wage payment of $19k. If you pay weekly the system will calculate withholding (and add extra medicare and cap SS) based on a projected $988,000 wage base (19x52)plus the $81k already paid and the net check just might come out to zero or less.

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