I want to pay an employee once a year for a period covering the entire year. I don't see how to do that as there is no once a year option (gives options for weekly, biweekly, monthly, etc.). I could set it up for a entire year to pay monthly and do it once (but the pay period would be wrong), but then I would have to delete every payroll transaction every month or set the employee to inactive (which I do not see the pencil as to how to do that in the 2018 version).
QuickBooks doesn’t automatically calculate the state or federal withholding supplemental rate on bonus wages. To compute the supplemental rate for state or federal withholding, manually change the amounts calculated on the paycheck.
Doing it as a bonus doesn't work because it sets the employee tax rate very high. ( I also tried other earnings with the same results) I guess it's thinking that a single payment amount in one month is multiplied by 12 to calculate the yearly tax rate. I tried it for one employee who I paid 22K for a single job for the whole year, and it put his tax rate at 54% when it should be around 13%.
As a previous software developer this seems like a pretty big bug. They need a "Yearly" choice on the period dropdown menu.
Based on the details you've provided above, it seems that you're using the online version. This could be the reason you're unable to see the yearly option when choosing a pay schedule. This is currently available in the desktop version as seen in the screenshot below. For more details, go through this article: Set Up and Manage Payroll Schedules.
I know the importance of having accurate tax rates when creating a bonus check or adding the other earnings type for your employee. With this, I'll take note of your suggestion and submit this directly to our Product Development Team. They can consider adding an annual option as a payroll schedule in the online version. I'd suggest visiting this website: Blog Posts. This link contains our latest news and product enhancements.