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Powercat
Level 2

How do we make a one time, end of year profit sharing contribution into an employee 401k plan? Payroll seems to only allow monthly contributions.

 
Solved
Best answer February 12, 2021

Best Answers
SarahannC
Moderator

How do we make a one time, end of year profit sharing contribution into an employee 401k plan? Payroll seems to only allow monthly contributions.

Hello there, Powercat.

 

It's nice to hear that you're already familiar with creating a new retirement plan contribution to an employee in QuickBooks Online. 
 

Yes, you're correct that you can make a large contribution for one pay period. However, we'll have to take note that there's a limit for the 401(k) plan. We created a table where you see the benefit plan limits, including 401(k) contribution. Click here to learn more about the benefits plan contribution limits for 2021. 

 

Still, I'd recommend following the recommendation shared by my colleague above. Also, you can run the Payroll Deduction/Contribution report to view your employees' total deductions and company contributions, as well as the plan total. Here's how:

 

  1. Go to Reports on the left panel.
  2. Enter Payroll Deduction/Contribution in the search box.

 

There are also other payroll reports that you can run. To learn more about it, please check here

 

I'd be glad to assist and provide the information you need. You can post your other concerns below. Take care always and stay safe.

View solution in original post

4 Comments
JonpriL
Moderator

How do we make a one time, end of year profit sharing contribution into an employee 401k plan? Payroll seems to only allow monthly contributions.

Hello @Powercat

 

As of the moment, there isn't an integrated way to make a one-time contribution for an employee's 401K retirement plan.

 

In the meantime, let's an annual maximum limit and per pay period contribution of the employee's retirement plan in question. Let me show you how.

  1. Go to Workers.
  2. Select Employees.
  3. Find and open the employee's profile.
  4. On the Pay section, click the Pencil icon.
  5. Scroll down to the deductions section, select +Add deductions.
  6. Under Deduction/Contribution, choose Retirement Plans.
  7. Click Done.

In addition, please remember to check this topic directly from the IRS for the annual maximums company contribution limits: IRS Retirement Topics - Contribution Limits.

 

In the same manner, here's an article you can read to learn more about your employee's retirement plans: Retirement plan deductions/contributions.

 

On top of that, I've also included this reference for a compilation of articles you can use while working with us: Help Articles for QuickBooks Online Payroll.

 

If you have any other questions, please let me know by leaving any comments below. I'll be here to lend a helping hand.

 

Powercat
Level 2

How do we make a one time, end of year profit sharing contribution into an employee 401k plan? Payroll seems to only allow monthly contributions.

Thank you for responding.  I am familiar with the instructions you provided.  Now, are you suggesting to make a

single large contribution during one pay period?  I am assuming that QBO payroll has no limit on what this can be.  Correct?  As long as it is in line with 401k guidelines.  Correct?

Powercat
Level 2

How do we make a one time, end of year profit sharing contribution into an employee 401k plan? Payroll seems to only allow monthly contributions.

no reply

SarahannC
Moderator

How do we make a one time, end of year profit sharing contribution into an employee 401k plan? Payroll seems to only allow monthly contributions.

Hello there, Powercat.

 

It's nice to hear that you're already familiar with creating a new retirement plan contribution to an employee in QuickBooks Online. 
 

Yes, you're correct that you can make a large contribution for one pay period. However, we'll have to take note that there's a limit for the 401(k) plan. We created a table where you see the benefit plan limits, including 401(k) contribution. Click here to learn more about the benefits plan contribution limits for 2021. 

 

Still, I'd recommend following the recommendation shared by my colleague above. Also, you can run the Payroll Deduction/Contribution report to view your employees' total deductions and company contributions, as well as the plan total. Here's how:

 

  1. Go to Reports on the left panel.
  2. Enter Payroll Deduction/Contribution in the search box.

 

There are also other payroll reports that you can run. To learn more about it, please check here

 

I'd be glad to assist and provide the information you need. You can post your other concerns below. Take care always and stay safe.

View solution in original post

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