Thanks @TedF this seems to solve the issue with the credit effecting the PL properly

I tried this and it won't let me deduct from my payment.

The next few weeks doesn't help.  We already have to employees out, I need to deduct this week.

If you did this correctly the effect on the P&L should be zero. 

Dear brookedegnan,

You are correct.  When payroll is processed, there is a debit to the Expense account for the amount of leave.  Then, making the tax payment using Pay Liabilities according to QB instructions, the result is a credit to the Liability account for the amount of the leave.  So...you now have a debit balance in Expense and a credit balance in Liability for the same amount.  Aaaaah!

I also called QB's and they calculating it incorrectly.  I think they have now set up the credit but I can't tell if it is correct.  You are correct that there should not be the employer's portion of social security withheld on Family Sick Leave wages.  I attempted to remove and override employers social security withholding via the edit function in the payroll item.  The dilemma is that it also removes employers medicare withholding which is wrong that should be a credit!  I am currently going to adjust it through my payroll tax payment until they realize they are incorrect

Can you please look at the IRS FAQ's on the credits and the employers withholding for FICA and Medicare at https://www.irs.gov/newsroom/covid-19-related-tax-credits-for-required-paid-leave-provided-by-small-... #10

There should be a credit for the employers medicare taxes on qualified leave pay, but the employers social security isn't a credit as qualified leave pay isn't subject to social security tax per FAQ#10.

Please advise!

Could it be that it will still asses the tax when creating the payroll and then it gives a credit against 941 deposit, so that in effect you are not paying SS match. 

im trying to do my payroll, can i go to "open paycheck detail" and enter their national paid leave there? looks like i can add their rate and quantity under other payroll items and select the national paid leave that i set up by QB instructions. 

Hello there, @jackpot, 

You're on the right track in setting up the national paid leave payroll item. Yes, you can click the Open Paycheck Detail button. Then, select this item in the Other Payroll Items section. Once done, you can finish processing payroll in the program. 

Additionally, I recommend running and customizing any payroll reports in QuickBooks. These will help you manage your payroll and employee expenses. Also, you can customize them to get the specific details you need. For more information, visit this article: Customizing Payroll And Employee Reports. 

I'll be right here to help if you need further assistance. Have a great rest of your day, @jackpot. 

We are still on Payroll version 04021441, with nothing from Intuit as to when to expect the next update.  The manual set up instructions do not address the fact that the new addition payroll items that we are told to set up should not be subject to the employer portion of social security.  I'm hoping that the new update will address this, as well as automate what is currently a very manual process that many users will undoubtedly be confused by and possibly make mistakes.  

I realize Intuit is working hard to address the needs, but other, more robust payroll packages had updates out on Monday that automated much of the needed changes, and calculate the SS tax correctly.  

Please, Intuit Team, someone give us an ETA on the much-needed update.  I have clients holding payroll for this.

Hi there, brucec.

Thank you for taking the time out of your day to reach out to us. I know how difficult times like this can be, just know that while we don't have an ETA right now, we are working round the clock to get the application up and running to simplify the matter. 

I recommend checking out this article about Our integration of the PPP as it highlights some FAQs as well as what our application will be able to do. 

Thanks again for your patience and if you need further assistance you can reach out here. 

The instructions were updated Friday for How to track paid leave and sick time for the coronavirus and How to claim my tax credits under the Family First Coronavirus Response Act. Everything worked out well and I was able to create the items and run the payroll, however a little more clarity is needed on what to do if the credit amount exceeds the liability while using EFT. If the credit amount exceeds current liability, the total calculated amount due towards EFTPS is negative. I am reluctant to hit E-pay button and send negative amount to EFTPS and get a rejected payment or similar. How does that work?

Hello there, RA75

The calculation of the liabilities are based on the number of hours. Before processing the payment through electronic services, I' d recommend consulting with the Internal Revenue Service (IRS) for more information.

You can get the contact details here: Internal Revenue Service Payroll Tax Compliance.

I'm also adding this article for reference: What you need to know about the Families First Corona virus Response Act.

Feel free to comment here if you have any other questions or concerns. Thanks.

You won't be able to process a negative payment in QB if your credit exceeds your liability.  You'll have to submit IRS form 7200, which is still only in draft form, I think.

Thanks for your reply, but I was referring to FFCRA paid sick leave issues, not the PPP Loans.  At this point, whatever PPP application you developed is going to be too late.  Most businesses have already  applied. Sole proprietors and independent contractors can supposedly apply today, but we're still waiting on a massive amount of guidance needed before that can happen.  The PPPL funds will be long gone before your application is ready.

We need help with the FFCRA paid sick leave issues now.  This can't wait, so you really need to stop wasting time on something that won't do people any good, and focus your efforts on FFCRA compliance.  The software needs to be fixed for the following:

• Paid sick leave wages are exempt from employer social security taxes.  Right now, that's impossible to set up in the payroll item.
• The software should calculate the amount of the credit so that it doesn't need to be done manually.
• All of the set up for paying FFCRA sick leave should be automatic, not something that needs to be setup manually.

Time is of the essence.  

Thanks for getting back to us, @brucec.

I can see how having this update would be helpful for you and your business. While we don't have an exact timeline, rest assured that I'll pass along your suggestion to our Product Developers. They're always looking for ideas to consider on how to improve QuickBooks.

In the meantime, I recommend visiting our Blog site. This is where we share recent happenings and future developments, such as updates to newly added features.

Just in case, I'll add this article for future reference: What you need to know about the Families First Coronavirus Response Act.

I want to make sure everything is taken care of for you, so please leave a comment below if you have any other issues or concerns. I'm always here to help. Have a good one!

@brucec is COMPLETELY RIGHT!! Please correct the Quickbooks Desktop Payroll software so that paid sick leave wages are exempt from employer social security taxes. Forget about developing software for the PPP loans.  That money from the government is likely already gone at this point and for Quickbooks to spend resources and manpower on software for the PPP loan (that could go towards correcting this issue) is really a total waste.

Yes. This!! How do we deal with a negative amount for EFTPS payment?  Will Quickbooks Desktop Payroll assist with filling out (or better, automatically filling out and submitting) Form 7200 so that the negative tax payment can be processed to us as a refund?

Hello there, giddyuptex,

Our QuickBooks Desktop Payroll support got all the information you need. They can address your concern about the negative amount for the EFTPS payment.

Here's how:

1. Go to Help, then select QuickBooks Desktop Help.
2. Select Contact Us.
3. Enter your concern, then select Continue.
4. Select from Start messaging or Get a callback.

You can also reach us here:

• Do It Yourself
• Assisted

Note that there's an adjustment on our support hours due to COVID-19. We're open from 6 AM-6 PM PT Monday-Friday.

TedF:  I'm trying to follow your instructions but I am unable to enter the credit in the company summary of the paycheck.  How did you do this?

Same.  I just spoke to support and they said the guidance isn't out on the support website yet but should be coming.  It does seem like at least for now, you will need to manually calculate the credit and apply it as a reduction to your 941 payment on the pay liabilities screen.

After I created the "Addition" per Intuit's instructions I tried editing the Taxes that are affected for the "Addition" but de-selecting "Social Security Company" also de-selects "Social Security Employee."  I ended up manually adjusting the "Social Security Company" amount on the affected individual paychecks so my payroll tax deposit would be correct.  Q6 "What is the amount of the refundable tax credits available to Eligible Employer?" of the "COVID-19-Related Tax Credits for Required Paid Leave Provided by Small and Midsize Businesses FAQs" on IRS.GOV makes clear in the Example cited that "<an eligible employer> does not owe the employer’s share of social security tax ... but it will owe the employer's share of Medicare Tax."

Cash or Accrual, the credit still shows as a payroll liability on the P&L.  What to do??