Payroll

Thank you for posting to the Community, @35351.

Let me share some details on how QuickBooks handles the calculation of your employee's Paid-Time-Off.

With QuickBooks Desktop, your employee's PTO calculation depends on how you set it up in the system or how it will accrue. Before entering the numbers, ensure to calculate them manually so that the system can give a favorable calculation. In this case, I recommend consulting your accountant for professional advice in setting up and providing PTO to your employees accurately.

Based on your calculation, since your employee's working hours vary, their paid time off is directly dependent on their hours worked. Just ensure entering the maximum number of hours each employee should work per week.

If it's 40 hours per week ( the most common hours work per week), here's how:

1. Figure out how many hours your employee works in a year.
2. Multiply it with the number of weeks in a year.
3. 40 hours (Hours in 1 workweek) x 52 weeks = 2,080 hours
4. Subtract the number of hours amount allocated for PTO.
5. 2080 hours – 40 hours (Allocated PTO) = 2,040 hours
6. 2,040 hours – 40 hours (5 paid vacation days off = 40 hours) = 2,000 hours per year
7. Divide the number of allocated vacation hours by the total hours per year.

40 hours (Hours in 1 workweek) ÷ 2,000 yearly hours worked = .02 hours

Using the following calculation means your employee will earn .02 hours of PTO per day.

In the meantime, here's how to enter your company's preferences for calculating your employee's PTO.

On the other hand, I added some articles to set each employee's PTO, including other resources like fixing calculations on how it affects the paychecks:

• Set up and track time off in payroll
• Sick Pay Maximums
• Sick and vacation time incorrect or not accruing on paychecks

Should you have other questions about managing your employee's PTO calculations, I'll wait for your comment below to help you more. Stay safe!

@35351RE: the week as a salaried employee, she worked 3 full days and took 2 PTO days. Can quickbooks desktop calculate this? I can't get it to work. 

Yes, it can handle this without issue.

There are two things going on here: 1) The default annual salary on the paycheck will be 2x what it should be in this case 2) The general way to handle PTO for salaried employees.

First, to get the salary right, edit the paycheck as you create it and enter the the appropriate salary amount instead of the default. Using a simple example, if the employee makes 52,000 per year, the default for a bi-weekly payroll will be 2,000, but as they were only on salary for a week, the salary should be 1,000.

Second, when paying a salaried employee for a pay period that includes PTO, use hours to split the pay between regular salary and the sick or vacation salary item being used. Use the number of sick or vacation hours you charge the employee for a day off as the basis. This is usually 8 hours per day.  So, in the case where the employee worked three days out of five, enter 24 hours for regular salary and (after adding the sick or vacation salary to the paychecks) enter 16 hours on its row. When you do this, QuickBooks will automatically split the salary - pro-rated by the number of hours on each salary row.

Once you get done, the paycheck earnings table should look something like this: