1. Our company's retirement plan, a Simple 401(k), was incorrectly setup as a Simple IRA in quickbooks. So when reviewing Form W-2, box 12 code is "S", and should be "D" ... How can this be corrected so the W-2's reflect accurately.
2. We made a 1-time retirement contribution to some employees' retirement account outside of payroll. How do we make the entry so it reflects on their W-2?
Thanks for reaching out to us here in the Community, @Anonymous.
I'm here to help make sure this is taken care of so you can process the W-2 form in QuickBooks Online (QBO).
For your first question, if there are multiple paychecks that are affected with the incorrectly set up retirement plan, this requires pulling up your account to further double-check which were unable to do it here in Community for security purposes. I'd highly suggest contacting out Payroll Support team. They have tools that can pull up and verify your account and help correct it's set up in a secure environment.
To answer your second question, you can create a zero net paycheck and record the entire retirement contribution. The steps do to this will depend on the payroll subscription you're using.
For QuickBooks Online Payroll (QBOP), here's how:
1. Add an Other Earning pay type to the employee's profile.
a. Set the amount to 0 or leave the $ field blank.
b. Rename it as Taxable offset or create your own name.
2. Setup a 401(K) Retirement plan deductions. Set the deduction amount to 0, then use the Net to gross formula to determine the gross pay amount.
3. Now go to Workers menu at the left panel, then Employees and Run payroll.
4. Pick a pay schedule and an employee.
5. Enter 1 in the TAXABLE OFFSET box, then click Preview payroll.
6. Select the Pencil icon beside the NET PAY amount.
7. In the Taxable offset box, enter the amount then make sure that the other pay types are 0.
8. Optional, zero out Federal Income Tax and State Income Tax in the Employee taxes section.
9. Enter the 401(k) amount on the Employee deductions section
10. Choose OK, then Submit payroll.
For Intuit Online Payroll (IOP), here's how:
1. Follow the steps 1 and 2 above, then go to the Payday tab.
2. Choose a pay schedule and an employee, then enter 1 in the Taxable offset box, then click Create Paychecks.
3. In the Approve Paychecks page, pick View/Edit.
4. In the Taxable offset box, enter the amount then make sure that the other pay types are 0.
5. Enter the gross amount in the Taxable offset field, then zero out federal and state income taxes. (Optional).
6. Select Add deduction, then the 401(k)deduction you set up.
7. Enter the 401(k) amount in the 401(k) box, then Save and Approved Paychecks.