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LDO
Level 5

questions about Alabama Overtime exempt for QB online payroll? Where?

The  QB Online Payroll  instructions say:


                 "Step 2: Enter the tax-exempt amount in QuickBooks

                 The amounts will flow to the paycheck calculation and will reduce the amount of AL income tax withheld."

 

But where do you enter the tax-exempt amount?  Quick books is a big place.
I did find a place in "preview payroll"  but it does not change the employee pay stub.  Nor does the paycheck list show the non exempt tax amount.

 

Thanks
LDO 

 

7 Comments 7
AbegailS_
QuickBooks Team

questions about Alabama Overtime exempt for QB online payroll? Where?

I'm here to assist you with your questions regarding how to enter your overtime time exemption, @LDO.

 

To begin with, you can manually calculate the tax-exempt pay amount and then enter it into the employee's profile in your QuickBooks Online Payroll (QBOP) account. However, please note that the tax exemption details will not appear on the paycheck/pay stub. Instead, the paycheck will automatically show the calculation but not the details and the description of the tax exemption. 

 

Here are the steps to manually calculate your tax exemption: 

 

  1. Go to Payroll, then Employees.
  2. Select Run Payroll.
  3. From your employee list, select Actions, then Add tax-exempt pay.
  4. Enter the tax-exempt pay dollar amount.
  5. Select Add.
  6. Repeat steps 3 - 5 for each employee with tax-exempt amounts.

For the tax-exempt calculation, follow the example guide in this article: Set up and track Alabama overtime exemption.

 

Additionally, we have some articles that can help you manage your employees, payroll schedules, and prepare for payroll-year end: 

 

The Community Team is always ready to help you with your payroll tasks or if you have any additional QuickBooks-related concerns.

LDO
Level 5

questions about Alabama Overtime exempt for QB online payroll? Where?

Where in the employees profile do you enter this?
  then enter it into the employee's profile in your QuickBooks Online Payroll (QBOP) account.  

DLHSES
Level 1

questions about Alabama Overtime exempt for QB online payroll? Where?

I entered the AL Exempt OT as directed, and see the amount added in to the employees pay amount. The net pay amount is correct. However, no amount shows on the taxes item labeled " AL Exempt Overtime Income" on the pay detail nor does it show on the employee paystub. Did I miss a step? 

 

 



GenmarieM
QuickBooks Team

questions about Alabama Overtime exempt for QB online payroll? Where?

Hello there, @LDO.

I am here to show you where you can enter the manually calculated tax-exempt pay in your QuickBooks Online Payroll (QBOP).

 

After calculating your tax-exempt pay of your employee, you'll need to enter the amount in their profile after running payroll.

 

Here's how:

 

  1. Go to Payroll, then click Employees.
  2. Select Run Payroll.
  3. A screen will pop up to select a pay schedule for the payroll.
  4. Click Continue
  5. Under the Actions, hit the three dots.
  6. Select Add tax-exempt pay.
  7. Enter the amount then Add.
  8. Repeat steps for your employees with tax-exempt amounts.

 

Moreover, I'm adding this helpful article as your reference in creating your paychecks in QuickBooks Online Payroll: Create and run your payroll.

 

Please don't hesitate to return to this post if you have other concerns about your payroll tasks in QBOP. I'll be here to lend a hand.

LDO
Level 5

questions about Alabama Overtime exempt for QB online payroll? Where?

DLHSES,  

I talked with QBO phone agent this morning.,  She was surprised to see that the detail report does has zeros next to ALA EXEMPT overtime.    I do not think that QB realizes that this info doesn't correctly print out on the Online user's detail report.   It may be there on the  Desktop users' detail report but not the online users detail report.  

There are only two places that i found where online users can see the AL exempt OT.    That is the 
"Payroll tax and wage summary"    Go to Reports >  Payroll Tax and wage summary >  AL Exempt Overtime Income.   And the 2nd place is employees > paycheck list click on DD (direct deposit to look at their stub) Weirdly while AL exempt OT. shows on the DD stub,  It doesnt show on the paycheck list info?????

Also when you "preview payroll"  there is a line under Employee Taxes.  this line is at the very bottom.  You must open the employee tax downward triangle first and scroll down and you will see a line below the totalt that says  AL tax exempt pay this period    edit 
 s

 

I have two more concerns:
(1) Alabama requires that we file the brand new 2023 historical overtime report by 1-31-24.  The QB phone rep told me that QB does not plan to file this and we must it on our own?  But how since QB is the bulk filer.
(2)  Given the QBOnline user's  detail report and summary reports do not show the AL OT exempt , how can we be confident that QB will file our A1,A2,a6s, correctly?   Yes the "Payroll Tax and wage summary report" is correct but I am skeptical since the other two report are wrong. 

I hope this helps!
LDO 


LDO
Level 5

questions about Alabama Overtime exempt for QB online payroll? Where?

The problem with using the three dots under  actions is that you either must manually calculate the overtime exempt dollar amount.  Or preview the paycheck to get the OT amount and then go back and use the three dot method

  1.  
MariaSoledadG
QuickBooks Team

questions about Alabama Overtime exempt for QB online payroll? Where?

Let me add some details about the updates of AL-OT Exemption, LDO.

 

Alabama has already enacted a new overtime rule for hourly employees by passing a house bill. With this, effective January 1, 2024, overtime pay received by full-time hourly employees will be excluded from being counted as taxable income for AL withholding tax.  

 

Apart from this, employers must also provide a one-time report that includes the total overtime paid during 2023 and the number of full-time hourly employees who received the pay.  This report is due January 31, 2024.  Currently, QuickBooks is still working on implementing the new taxation requirement for this compliance change and we'll provide an update when the ability to set up and track this new AL requirement becomes available. Therefore, we'll have to wait for the updates before filing AL overtime. 

 

However, I still recommend reaching out to our support team for any updates on this. They have the tools to pull up your account in a secure environment. 

 

Aside from the list of payroll reports that QuickBooks Online (QBO) offers, learn how you can customize them to ensure you'll get the right data for your business. I've added this for your reference: Customize Reports In QuickBooks Online.

 

Drop your comment below if you have any other concerns. Please know we're always right here to help you anytime.

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