How do I use the employee retention credit feature for salaried employees?

Thanks for reaching out to the Community, misscecilySF.

For salaried employees, you'll need to select their salary amount shown to reduce the hours by how many you're paying them with through Employee Retention pay items.

Here's how:

1. From the Overview screen on your Payroll menu, choose Run Payroll.
2. If you have multiple pay schedules, pick the appropriate one.
3. Enter their hours in each corresponding field. Regular hours go in your Employee Retention Credit Regular section. Overtime hours can be entered in the Employee Retention Credit Overtime area. If applicable, enter your Employer Health Insurance Premium.
4. Select the employee's salary amount to reduce their hours by the amount you're paying them with Employee Retention items.
5. Enter any other items you need to include.
6. Hit Preview Payroll.
7. Review your paychecks.
8. Click Submit Payroll.

I've additionally included a detailed resource where you'll be able to find more information about setting up pay types and tracking the Employee Retention Credit: How to set up & track the Employee Retention Credit
 

Please don't hesitate to send a reply if there's any questions. Enjoy the rest of your day!

Hi Zack,

As I mentioned in my question details, your solution does not work the way it is supposed to, according to your instructions.-- when I try to reduce the salary amount by putting a number of hours in the Employee Retention Credit hours box, this ends up DOUBLE PAYING the employee (salary PLUS ERC hours) rather than subtracting the hours. This method works for Sick, or Vacation, but the ERC box for hours only adds more hours, it does not adjust the salary amount the way you describe in your answer. I wish it did! Can you let me know when this will be fixed?

Hi Zack,

As I mentioned in my question details, your solution does not work the way it is supposed to, according to your instructions.-- when I try to reduce the salary amount by putting a number of hours in the Employee Retention Credit hours box, this ends up DOUBLE PAYING the employee (salary PLUS ERC hours) rather than subtracting the hours. This method works for Sick, or Vacation, but the ERC box for hours only adds more hours, it does not adjust the salary amount the way you describe in your answer. I wish it did! Can you let me know when this will be fixed?

Hello, Miss Cecily. 

Thanks for getting back to us with the details. I have one more solution to help you with the ERC calculations on your salaried employee. 

The pay adjustments happens after previewing your payroll. You'll want to double-check the calculations after adding the ERC hours:

1. On the Run payroll screen, enter the ERC hours then click the Preview payroll button.
2. Double-check the Net pay amounts.
3. If you'd like to see the breakdown of the taxes, click the Pencil icon beside the net pay amount.
4. Expand the sections and ensure the calculations are correct. 

However if it still calculates the incorrect amounts after previewing and checking the ERC calculations, you'll want to contact our payroll support.

They can check the system what's causing the values to add up and correct the calculations. Here are the steps to contact them: 

1. Click the Help menu.
2. In the chat box, enter something like "Speak to an agent."
3. When asked, type "talk to a human" or "ERC calculations are incorrect for salaried employees."
4. Proceed with I still need a human.
5. Click the Get help from a human option, then choose how you want to contact us. 

I'm adding these references in case you need more help with the ERC payroll instructions: 

• FAQs: Employee Retention Credit under the CARES Act
• What you need to know about the Families First Coronavirus Response Act and American Rescue Plan Act

Need to make sure your employees have the correct liabilities within a certain period? Our payroll articles can help you see the data. If you need help running one, you can check this article: Run payroll reports.

You're more than welcome to post here again if you need help with your payroll taxes or your employees. If you have concerns about QuickBooks Online, I'll hear them out.