Employee 401k Contributions

Thanks for dropping by, @JMG72. I'm here to share some insights about your employee deferral concerns. 

QuickBooks Online Payroll creates default accounts for you to record your payroll liabilities and costs. If you'd rather record it in a different register or account, you can do so in your QuickBooks Online Chart of Accounts by creating a new one.

To correct the Retirement Expense, you'll need to assign it to the correct account in your payroll accounting settings. To do so, you can follow the steps below: 

1. Go to Settings ⚙, then Payroll settings.
2. Select Edit ✎ next to Accounting. 
3. Select Edit ✎ to update the Other Liability & Asset Accounts section.
4. Choose which account the transaction for the specific payroll item should go into. Then click Continue.

To learn more about changing your accounting preferences in QuickBooks Online Payroll, you can click here. This includes the account type as well as how to set up the payroll account.

For future reference, you'll want to view these articles. These contains useful information you can use for your business and employees:

• Retirement plan deductions/contributions.
• Track your deferral payments.
• Run reports in QuickBooks Online.

Feel free to leave a comment below if you have other concerns about employee deferral. I'm always here to help. Have a great day!

Thank you for your response. Since my 401k administrator does one automatic withdrawal of the 401k contribution for both employer and employee contributions. Would I split that transaction between the retirement expense it is current categorizing it in and the new payroll liability for the employee deferral portion?

Thank you,

Jason

Hey JMG72, 

Thank you for responding back to us! For this situation, it would be best to reach out to your accountant to see what is the best practices for you business. If you don't have an accountant we provide a ProAdvisor service where you can connect with experts within your area. Some even offer free consultation! Use this link to Find an Accountant.

Let me know if you have any questions! I will be happy to help further. I hope you have a good day!