I'll provide details on how payroll taxes are calculated so you can identify why QuickBooks isn't taking them out for both federal and state from your employees' paychecks, Meredith123.
QuickBooks bases its calculation of federal income tax (withholding) on several factors, including the employee's W-4, pay frequency, gross wages, and the percentage or wage bracket method. State income taxes, on the other hand, vary from state to state.
Furthermore, there may be instances where federal or state income taxes will display as $0.00. This is a common occurrence when the gross wage of your employee is below a certain threshold or if they have claimed Exempt. For more details, please see this article: Understand how your payroll taxes are calculated.
Additionally, you may want to run payroll reports to get a detailed analysis of your company's financial status and access valuable insights regarding your business and employees.
You can always let me know in the comments if you have any other payroll concerns or questions about federal and state taxes. We in the Community will get you covered.
