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hm4
January 7, 2019
Solved

Third Party Payroll Deductions

  • January 7, 2019
  • 1 reply
  • 9 views

We use ADP for our payroll. When we enter the payroll information into QuickBooks (QB), we have a line for the Salary Account, a line for the Employee Withholdings Account, and then do a complete separate entry for the Employer Liabilities per employee (which is a vendor). 

 

We recently acquired health insurance and need to do payroll deductions for some of the employees (vendors). How do I input the deductions (either just the total deduction/employee such as $150, or deduction/insurance/employee such as $100 for medical and $50 for dental). I know QB recommends using a Journal Entry for third party payroll, but unfortunately this is how the system was initially set up and will not be changed by the finance department. 

 

If you could elaborate how this would effect the P&L and Balance side, I would greatly appreciate it. Thanks!

Best answer by KhimG

Hi there, @hm4.

 

Thanks for visiting the Community. Let me share some information about recording data from a third-party payroll service into QuickBooks Online (QBO).

 

Most QuickBooks users with an outside payroll service use Journal entry and checks to record transactions. You’ll have to get a report from ADP and enter the data manually in QBO.

 

Here’s how:
1.    Go to the Plus (+) icon and select Journal Entry.
2.    In the Journal date field, enter the transaction date.
3.    Fill out the information needed.
4.    Once done, hit Save.

 

 

 

For more details on which accounts to debit or credit, please refer to this link: https://quickbooks.intuit.com/community/Employees-and-payroll-taxes/Record-payroll-transactions-manually/m-p/185635

 

The scenario provided on the article does not include insurance or retirement. You may want to consult your payroll service provider or accountant to ensure your books are correct.

 

That should get you pointed in the right direction. Please let me know if you need anything else. Thanks for coming to the Community and take care!
 

1 reply

K
KhimGAnswer
Level 7
January 7, 2019

Hi there, @hm4.

 

Thanks for visiting the Community. Let me share some information about recording data from a third-party payroll service into QuickBooks Online (QBO).

 

Most QuickBooks users with an outside payroll service use Journal entry and checks to record transactions. You’ll have to get a report from ADP and enter the data manually in QBO.

 

Here’s how:
1.    Go to the Plus (+) icon and select Journal Entry.
2.    In the Journal date field, enter the transaction date.
3.    Fill out the information needed.
4.    Once done, hit Save.

 

 

 

For more details on which accounts to debit or credit, please refer to this link: https://quickbooks.intuit.com/community/Employees-and-payroll-taxes/Record-payroll-transactions-manually/m-p/185635

 

The scenario provided on the article does not include insurance or retirement. You may want to consult your payroll service provider or accountant to ensure your books are correct.

 

That should get you pointed in the right direction. Please let me know if you need anything else. Thanks for coming to the Community and take care!
 

qbteachmt
qbteachmt
Level 11
January 8, 2019

You can do it with Split Details on the check, too. You don't Need to use JE.

 

Like this:

Gross Wages (expense)

minus every kind of Liability deduction that you pay out later

= Net takehome on this check

 

Here is a topic with Images, from QB Mac, that is the same thing:

https://qblittlesquare.com/2011/02/payroll-i-want-to-do-it-myself/

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