Payroll: employee moved to another state. How to properly change an employee state for taxes

DesktopPayroll2021 · ‎February 28, 2022

I have one employee that moved out of state. She's asking me to change her taxes to IN.

(I tried google and youtube, but I couldn't find an answer)

Under Employee Center > Employee > Payroll Info > Taxes > State: when I change the state to IN, it give me a warning: "IN - Withholding is not in the Payroll item list."

How do I properly setup another state Withholding?

Beside her address change what changes do I need to make for this employee?

Adrian_A · ‎February 28, 2022

Hello there, DesktopPayroll2021.

I appreciate you for getting back to us.

You'll get that error since you haven't set up a withholding item for your employee's new state. Let me guide you on how to set it up:

From the Lists tab, select Payroll Item List.
Click the Payroll Item drop-down and select New.
Select Custom Setup > Next.
Click State Tax > Next.
Click the drop-down arrow and select IN, and then select State Withholding.
Select Next.
Enter the name of the payroll item and select Next.
Enter the name of the agency and the account number.
Select the correct liability account. Hit Next.
Review the wage items used in calculating withholding. Click Next.
Verify any pretax deductions that reduce wages for this tax.
Click Finish.

From there, you can create paychecks with your employee's new state.

Feel free to pin these articles as a guide in creating and printing paychecks:

That should do it, DesktopPayroll2021. Count me in if you need a guide in running payroll. I've got your back!

View solution in original post

SashaMC · ‎February 28, 2022

Hey DesktopPayroll2021,

Thank you for reaching out to the QuickBooks Community! I will be delighted to help you further. Before we do, are you using Assisted Payroll or Enhanced Payroll? Knowing this information will help us tremendously.

I will be looking out to your response! Simply hit that Reply button below. Take care for now!

DesktopPayroll2021 · ‎February 28, 2022

We have Enhanced Payroll

Kurt_M · ‎February 28, 2022

Thank you for the additional information, @DesktopPayroll2021. I'll help you proceed to change the state tax of your employee.

In just a few simple steps, you can change an employee's state tax here in QuickBooks Desktop (QBDT). To begin, these are the steps:

In QuickBooks Desktop, choose Employee tab and then select Employee Center.
Double-click the employee's name and then click the Payroll info tab.
Click on Taxes button.
Click the Federal tab, and make any necessary changes. Please note that you cannot change Medicare, Social Security, or Federal Unemployment Tax.
Click the State tab and then make any necessary changes to the State Worked or State Subject to Withholding areas. Do not uncheck SUI or SDI.
To change local taxes, click the Other tab and then click the Item Name column.
Click the drop-down arrow, and then select the local tax you want to add.
Click OK to return to the Edit Employee window, and then click OK again.

For more information, you can visit this article about how to change state taxes for an employee.

Our Community Help Articles page contains resources, video tutorials, and tips to manage your company files. If you need more information, feel free to visit the site.

Additionally, here are some articles to help you in the future:

As always, don't hesitate to get back to me if you need further assistance with updating your employee's state tax. I'll be more than happy to provide additional assistance. Keep safe and stay hydrated!

DesktopPayroll2021 · ‎February 28, 2022

Sorry, but it doesn't answer my 1st question:

"Under Employee Center > Employee > Payroll Info > Taxes > State: when I change the state to IN, it give me a warning: "IN - Withholding is not in the Payroll item list."

How do I properly setup another state Withholding?"

Adrian_A · ‎February 28, 2022

Hello there, DesktopPayroll2021.

I appreciate you for getting back to us.

You'll get that error since you haven't set up a withholding item for your employee's new state. Let me guide you on how to set it up:

From the Lists tab, select Payroll Item List.
Click the Payroll Item drop-down and select New.
Select Custom Setup > Next.
Click State Tax > Next.
Click the drop-down arrow and select IN, and then select State Withholding.
Select Next.
Enter the name of the payroll item and select Next.
Enter the name of the agency and the account number.
Select the correct liability account. Hit Next.
Review the wage items used in calculating withholding. Click Next.
Verify any pretax deductions that reduce wages for this tax.
Click Finish.

From there, you can create paychecks with your employee's new state.

Feel free to pin these articles as a guide in creating and printing paychecks:

That should do it, DesktopPayroll2021. Count me in if you need a guide in running payroll. I've got your back!

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Payroll: employee moved to another state. How to properly change an employee state for taxes