We use an outside source for payroll. How do I correctly enter the transactions for employees who have child support deducted into the general journal and check register so the P&L and Balance Sheet reflect the proper amounts?

Let's review payroll math:

Gross wages plus employer taxes = net take home and all payroll checks written

"and then enter the checks into the register using same subaccount for the child support check "

Which Register? The Bank?

"I enter payroll as a journal entry with child support as a subaccount of employee wages "

That is an error. The journal entry will be Debit Gross Wages, and Credit "Child Support Liability account."

When you write the check to pay the garnishment, on the Expenses tab, you list the Child Support Liability account.

Garnshiments NEVER hit the P&L. This is NOT the employer's garnishment or expense. It is a liability: you held back money from the employee's takehome check and need to prove you paid it out to the child support enforcement division.

It is Balance Sheet activity, not P&L.

Hi:

This chart may help you.

http://finance.toolbox.com/blogs/quickbooks-tips/how-to-enter-payroll-prepared-by-an-outside-payroll...

On your books you will be posting the amount that is withheld from the employee's payroll as a credit to a liability. (Garnishments Payable or whatever you want to call it). When you issue the check in payment of the garnishment, you would post the debit to the same account. The balance should zero out after each payment.

Hope this helps.

You don't need to do that.  Child support is deducted from the amount you already paid your employee -- which is already recorded on your books.  In other words, child support is neither your liability nor your expense; the employee wage is.

Child Support is Never Employer Expense. It is diversion of takehome.

The Payroll Math is:

Gross Wages <== employer expense

Employer taxes <== employer expense

Everything else is deducted or withheld from Gross Wages

Example:

Gross Wages $1,000 Debit

Employer taxes $76.50 expenses (using only FICA for this example) Debit

Credit Payroll Liability for $76.50 for employer + the $76.50 for the employee FICA, + the employee income tax withholding amount, + child support deduction

Credit Bank for takehome

And later, the Check Expenses pay out the various Liabilities you held back. That is never expense, again.

And you don't use Liability if the PR service provider keeps all your funds up front = they impound the taxes up front.

Debit Gross Wages

Debit Employer tax share

Debit PR provider fee

Credit Banking for that total they kept

So how to you clear this account out at the end of the year.  Does it go through the payroll expense account?  Or is there a separate account that goes with it.

Does anyone have a resolution to this problem for quickbooks online? I would love any help i can get. 

Thanks for checking in, @1374 1252 40,

We were alerted to a third-party issue with direct deposit processing this morning that has delayed the deposit of employees' paychecks into their accounts. The issue has been resolved and your employees should expect to see the funds available in their bank account by end of the day today.

We know how critical each paycheck is to your team. This is, even more, the case in our current environment. Thank you for your patience as we focus to ensure your employees’ funds are available as soon as possible.