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Level 1

Trying to figure deductions for payroll

I am splitting the payroll expense into taxes, medical, etc. This is our first month taking deductions out of payroll and employee contributions are greater than the amount charged. How do I account for that?
3 Comments 3

Trying to figure deductions for payroll

Hi there, @tina-altaclaro-c.


I want to ensure you'll be able enter employee deductions in QuickBooks Online (QBO).


Below are the steps you can follow in assigning deduction or contribution to your employee:

  1. In your QBO account, go to the Payroll menu and select Employees.
  2. Next, click the employee's name.
  3. Then, select the Edit icon next to Pay.
  4. From the deduction section, choose + Add a new deduction or + Add deductions.
  5. In the Deductions/contributions dropdown menu, select New deduction/contribution.
  6. Next, choose a Deduction type and Type from the small arrow icon.
  7. Input the Provider name (appears on paycheck).
  8. Click the Amount per pay period icon, and select $ amount or % of gross pay and enter the $ amount or percentage. Do the same for the Company-paid contribution as applicable.
  9. Once finished, select Done.


For your reference about the process, please visit this article: Add or edit a deduction or contribution. 


Also, making changes to your employee payroll deductions such as the amount deducted, or remove the item from your employee is a breeze in QBO. Check this link for the detailed steps: Change or delete a payroll deduction item in Online Payroll. This also includes guidance on how you can perform the action to other payroll service.


Stay in touch if you have any other questions setting up deductions in QBO. I'm just a few clicks away to help. Have a great day ahead. 

Level 1

Trying to figure deductions for payroll

We don't use QB for Payroll, we use an outside processor. The situation is that when the payroll expense comes from the bank into QB, I split the categories by taxes, medical, etc. We recently had an expense come through where the amount was deducted from the employee's paycheck for medical (pre-tax) but none was taken out from the employer for that pay period. That reduced the total amount that was deducted from our account. For example - we owed $2500 total with taxes but since $120 was taken from his paycheck for medical, it only took $2380 from the bank. How do I account for that difference in the expense categorization?

Candice C
QuickBooks Team

Trying to figure deductions for payroll

Good morning, @tina-altaclaro-c.


Thanks for reaching back out and letting us know some additional information. I can point you in the right direction. 


To be sure of these details in your account, I suggest consulting with your accountant. They'll be able to give you the best advice for your business. 


Once you've spoke with them, you can come back and we'll help you out with the information in QuickBooks Online. I'll be waiting for your response! 

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