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Level 1

How do you create a payroll item for the COVID paid sick leave?

 
49 Comments 49
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QuickBooks Team

How do you create a payroll item for the COVID paid sick leave?

Hello there, @flair8082.

 

Thank you for visiting the Community to find out more about the correct payroll workflows for changes happening due to COVID-19.

 

Changes are coming daily to QuickBooks Online Payroll, Intuit Online Payroll and QuickBooks Desktop Payroll. Thank you for your patience as we work to support you. The Families First Coronavirus Response Act goes into effect with leave taken April 1, 2020 and after. Our payroll teams here at Intuit are working quickly to create the appropriate pay types so that you can track and report hours towards this tax credit for your small businesses. 

Per the Act, if an employee was impacted and took time off for COVID-19 related issues prior to April 1, 2020, the time would be tracked as regular sick hours and is not eligible for any tax credits at this time.

Please keep an eye out for any updates in your email and the QuickBooks Blog. You're always welcome to follow up on any related thread here in the Community as well.

 

We understand how difficult a time this is for you and your business. Just know, we're here if you need us.  

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Level 9

How do you create a payroll item for the COVID paid sick leave?

Setting up a standard sick pay item will impact any standard sick pay hours for the employee.

 

If you mean that you want to set up a special item that does not impact sick pay, then it'll just be a standard pay item, perhaps with a descriptive name so you can tell what it is for in your reports.

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Level 3

How do you create a payroll item for the COVID paid sick leave?

I tried following their instructions with Saturdays release, very confusing. not sure if its better to just setup an hourly item for this, but i'm afraid it won't transfer to 941 correctly to take advantage of the credit. Per IRS i saw they will be using 941 to track this.

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Level 2

How do you create a payroll item for the COVID paid sick leave?

The Quickbooks step-by-step instructions for setting up desktop payroll under FFCLA are great - UNTIL you get to "Next Steps" and then it royally SUCKS!!!  It just says "Run a Regular Payroll"...  But how do I enter the COVID-19 hours???  They don't appear!  I just see my regular Hours, Crew, OT, Bonus, etc.  If I enter the hours like a "regular" payroll, how is it gonna track the Paid Time Off hours for COVID-19???  They really need to explain that in detail as well.  The instruction says "make sure you add the appropriate items for the paid leave" - but how?  I thought the prior instructions just did that, but nothing shows up!  This is horribly confusing and QB really dropped the ball at the end of the instructions.  It isn't a "regular payroll" - it is a COVID-FFCRA payroll - how the heck do I enter an employee's hours for the new items if there is no place to enter them???  C'mon QB - write this stuff for dummies like me!!!  Mike

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QuickBooks Team

How do you create a payroll item for the COVID paid sick leave?

I'm here to walk you through the steps on how to add the hourly payroll item, Mike. 

 

With QuickBooks Desktop Payroll, you can ensure your employees have the money they need, and you comply with the Family First Coronavirus Response Act (FFCRA). To set this up, we'll need to determine the employee's benefit and hourly rate and from we'll set up a liability and expense account for the paid leave. Then, create a payroll and tax item item. I also suggest reaching out to an accountant for more help with identifying account and payroll item type for tax purposes. 

 

Once, we have identified the accounts and employee's type, ere's how to create a hourly payroll item:

  1. Go to the Employees menu and choose Manage Payroll Items
  2. Select New Payroll Item
  3. Click Custom Setup and then Next.
  4. Select the Payroll Item Type (Wage) > Next
  5. Click the Wage payroll item type (Hourly Wages) > Next
  6. Select the item for regular, overtime, sick, or vacation pay. Then, Next
  7. Enter a name something like COVID-19 hours. Click Next
  8. Select the correct Expense account we just set up or an existing one.
  9. Hit Finish

For the detailed steps, we can use this reference: How to track paid leave and sick time for the coronavirus. Now, we can run payroll and add the item and the hours rendered. 

 

You can always mention me if you need more help. Keep safe!

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Level 2

How do you create a payroll item for the COVID paid sick leave?

Thank you VERY much!!!  So if my employees each have two different hourly pay rates depending on what work they do, "in shop" and "at event", I would essentially do that twice - one item for each rate, correct? 

And for myself (or salaried employees), the QB instructions seem to indicate I cannot pay myself my salary for the COVID pay, I need to convert it to hours, yes?

Thank you again - you have been vary helpful and I appreciate it immensely!  Mike 

 

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Level 2

How do you create a payroll item for the COVID paid sick leave?

Thank you VERY much!!!  So if my employees each have two different hourly pay rates depending on what work they do, "in shop" and "at event", I would essentially do that twice - one item for each rate, correct? 

And for myself (or salaried employees), the QB instructions seem to indicate I cannot pay myself my salary for the COVID pay, I need to convert it to hours, yes?

Thank you again - you have been vary helpful and I appreciate it immensely!  Mike

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Moderator

How do you create a payroll item for the COVID paid sick leave?

You're welcome, Mike!

 

You'll want to create two items for each rate since they're different. And also, you're right with having to convert your salary to hours.

 

Just follow the steps above to create the items.

 

Please know that the Community is always open if you need help.

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Level 3

How do you create a payroll item for the COVID paid sick leave?

Hi the step you described makes total sense in regard to setting up and hour rate item, but when it comes to the link you posted those steps throws me off. for example in step three it has us creating another payroll item using the addition type. what is the point of using the addition type of payroll item vs the normal wage payroll item? with the normal wage type of payroll item i am able to use timesheet to input/pull covid-19 hours, not with addition type. also in step 4 what  is the point of that?

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QuickBooks Team

How do you create a payroll item for the COVID paid sick leave?

Thank you for getting back to us here on the Community page, @chris111.

 

This article guides us with the detailed steps on how to track the paid leave and sick time for the employees affected by COVID-19.

 

For step 3, we need to set up an addition payroll item/s to track each type of paid found under the Family First Coronavirus Response Act (FFCRA) in step 1, using the expense and/or liability account from step 2.

 

On the other hand, step 4 shows you  how to set up a new tax item to ensure tax credits are tracked accordingly.

 

In case you need further assistance with setting up your items correctly and securely, feel free to reach out to our Support Team

 

Click the Reply button and add a comment below if you have any other questions. I'm a post away to help. Have a great weekend!

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Level 3

How do you create a payroll item for the COVID paid sick leave?

So if i put the covid earnings on top of 40hrs x $20 which is 800 do i also add the same in other payroll items per step 3? doesn't make sense as it is paying double?

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Moderator

How do you create a payroll item for the COVID paid sick leave?

Hello again, chris111. I appreciate your prompt response.

 

As mentioned in step 3 on the article about how to pay the employees paid leave if they’ve been affected by COVID-19 in QuickBooks Desktop Payroll after the liability and expense accounts are set up, you'd need to set up payroll items to track each type of paid leave found under the FFCRA that you identified in step 1. Then, use the same payroll item. Doing so will not double up the payment. 

 

For more detailed guideline, you can consider checking this article for more information: How to track paid leave and sick time for the coronavirus.

 

If there's anything else I can do for you, let me know by commenting below. I'd be happy to further assist you. Have a great day. 

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Level 3

How do you create a payroll item for the COVID paid sick leave?

so from this pic what is wrong? remove the item on top or the one on the bottom?

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QuickBooks Team

How do you create a payroll item for the COVID paid sick leave?

Hello chris111,

 

For us to check on your account and make sure you have the correct setup for the Family First Coronavirus Response Act (FFCRA), I'd recommend reaching out to our Customer Care Team via messaging. 

 

Here are the steps:

 

  1. Click Help located at the top.
  2. Choose QuickBooks Desktop Help.
  3. In the Have a Questions window, type a question and click the Contact Us link located at the bottom.
  4. Select any topic and enter a brief description of your issue in the Contact Us page. 
  5. Under Here's how to connect with a QuickBooks expert about, click the Start a Message button.

 

You can also leave a reply on this thread if you have additional questions or other concerns. Thanks.

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Level 1

How do you create a payroll item for the COVID paid sick leave?

The FFCRA adds to the tax credits the amount of the Hospital Insurance tax, also known as Medicare tax, that Eligible Employers are required to pay on qualified leave wages.  The rate for this tax is 1.45 percent of wages.  (Eligible employers subject to Railroad Retirement Tax Act do not get this credit.)

Note: There is no credit for the employer portion of OASDI tax, also known as social security tax, that Eligible Employers are required to pay on the qualified leave wages because the qualified leave wages are not subject to this tax."

 

I am not able to figure out how to make the new FFCRA leave NOT subject to OASDI-Employer (as stated above) in QB.  When you select Medicare Company in QB it automatically selects Social Security Company also, but from all the guidance I have seen, the FFCRA leave is not subject to OASDI-Employer. How is this being addressed?

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QuickBooks Team

How do you create a payroll item for the COVID paid sick leave?

Hi SKL. We have an article about how to track paid leave and sick time for the coronavirus. This article also contains all the information on setting up the Tax and Payroll Items for your payroll in QuickBooks Desktop. You should be able to follow the steps in the article and you will be good to go for proper payroll tracking during this period.

 

I know things have been extremely stressful, so if you have any other questions just respond here. I'm always happy to help, 

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Level 1

How do you create a payroll item for the COVID paid sick leave?

Hi.  All of this is very helpful, however in the article on step 4 for setting up a new tax item is incomplete. Once I get to the 8th step it says to click finish and I should be done, but that is not the case.  After step 8 my QB is asking for 6 more steps and I am completely lost.  Maybe you can help?  Thank you.

1. Tax Tracking Type

2.  Calculate based on

3.  Default rate and Limit

4. Limit Type

5. Taxable Compensation (Select the items that will increase wages for this tax)

6. Pre-Tax Deductions

 

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QuickBooks Team

How do you create a payroll item for the COVID paid sick leave?

Hi traeblake. For these types of questions, I would recommend you reach out to a tax professional. You can find one right on our find a Pro-Advisor page. On this page you can find a QuickBooks Certified Pro-Advisor who fits your accounting needs.

 

Doing this will ensure that everything is set up correctly according to your business's personal tax needs. Let me know if there are any other questions. 

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Level 2

How do you create a payroll item for the COVID paid sick leave?

I ran into the same problem with Step 4. Please QB's send us a revised Step 4!

 

Thanks

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Level 2

How do you create a payroll item for the COVID paid sick leave?

I ran into the same problem with Step 4. Please QB's send out full directions!

 

Thanks

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Level 1

How do you create a payroll item for the COVID paid sick leave?

The instructions aren't complete.  It doesn't explain how to use all of these new items in an employee paycheck.  It's also taxing full social security on the EPSL wages, which it shouldn't be. Please provide better instructions, or better yet, provide the correct payroll items and instructions for use.  Instructions are very poorly written.

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Level 3

How do you create a payroll item for the COVID paid sick leave?

With all due respect, there are two versions of advice being published by Intuit on how to set up the payroll items. The top of this thread says to set them up as Wage items and the link that you are referencing  says to set them up as Additions  And therein is one of the big issues. Someone has to clarify which instruction set is correct: Set up as WAGE item or ADDITION? 

 

The second big issue is the the instructions in Step 4 to set up the tax item is not correct for many of us. I cannot follow those steps in Premier Contractor 2019 because I only get one "Other Tax" screen option.  I can see from the other posts that I am not alone. So someone needs to correct the instructions.

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Level 3

How do you create a payroll item for the COVID paid sick leave?

Actually, these are questions arising because Step 4 of the Instructions are incorrect or not compatible with some versions of Desktop. They are not questions for our tax professionals if we are attempting to follow your instructions. 

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Level 2

How do you create a payroll item for the COVID paid sick leave?

So I was having all the same problems as listed in this thread. I went to my payroll center and did a payroll update and guess what...... all the problems we are having were fixed in the update. the tax tracking items all appeared and the places where you ran into trouble and the instructions did not work all made sense because the update loaded all the missing links. So do the update in payroll and delete all the previous entries you made and start all over. You can leave the liability and expense accounts you made but you need to delete all the payroll items you just tried to create. You can not edit the payroll item you need to delete them and start over. You will find the missing tax tracking items you are looking for in the drop down menus for each area. Good luck

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