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user64014
Level 1

Will Quickbooks Online automatically handle and calculate the Employee Retention Tax Credit which is associated with the COVID-19 stimulus including on the Form 941?

 
20 Comments 20
Anna S
QuickBooks Team

Will Quickbooks Online automatically handle and calculate the Employee Retention Tax Credit which is associated with the COVID-19 stimulus including on the Form 941?

Good afternoon, @user64014.

 

I know ensuring all your tax forms are correct can be challenging during this time, but I got your back. 

 

QuickBooks Online will automatically calculate the Employee Retention Tax Credit as long as you set up your employee's paid leave correctly. After you set it up and run payroll, you can check the payroll reports for the credit. You'll want to run the Payroll Details report, Payroll Summary report, and the Tax Liability report to see the tax credits that will automatically apply to your liability. You may find this article helpful as well: Pay employees under the Family First Coronavirus Response Act.

 

I'm only a reply away if you have any other questions. Take care!

KelleyC
Level 2

Will Quickbooks Online automatically handle and calculate the Employee Retention Tax Credit which is associated with the COVID-19 stimulus including on the Form 941?

It seems to me you are confusing two different programs.

The Families First Coronavirus Response Act (the "FFCRA"), signed by President Trump on March 18, 2020, provides small and midsize employers refundable tax credits that reimburse them, dollar-for-dollar, for the cost of providing paid sick and family leave wages to their employees for leave related to COVID-19.

The other program is:

Employee Retention Credit, designed to encourage businesses to keep employees on their payroll. The refundable tax credit is 50 percent of up to $10,000 in wages paid by an eligible employer whose business has been financially impacted by COVID-19.

Our business has had many meetings/travel cancelled due to the stay-at-home orders. We have 8 employees. They are working from home getting pay salary/hourly pay. No one is on paid sick or family leave. We qualify for Employee Retention Credit and also the Payroll Tax Deferral Program. (we are a 501(c)6 so don't qualify for the PPP) We use Assisted Payroll so Intuit files all of our tax forms and deducts all of our payroll taxes. How do I let Intuit know that I want to utilize the help offered to us regarding the ERC & RTDP?

Nick_M
QuickBooks Team

Will Quickbooks Online automatically handle and calculate the Employee Retention Tax Credit which is associated with the COVID-19 stimulus including on the Form 941?

Hi KelleyC.

 

You may claim the Employee Retention Credit for qualified wages that are paid after March 12, 2020, and before January 1, 2021. Therefore an Eligible Employer may be able to claim the credit for qualified wages paid as early as March 13, 2020.

 

With that being said, if you would like assistance setting up for the ERC, I recommend contacting our Payroll Support team for further assistance. This article has detailed steps on how to reach them: 

- Contact Support

 

For future reference, I'll leave these articles here for you to check out, they're updated regularly and will help down the line. 

If you have any other questions or concerns, feel free to post them here. 

 

Have a nice evening. 

 

LifeClinic4818
Level 1

Will Quickbooks Online automatically handle and calculate the Employee Retention Tax Credit which is associated with the COVID-19 stimulus including on the Form 941?

Ok once you have your payroll set up for the Employee Retention Credit as stated in your articles, how do I go back and fix several payrolls that have already been run.  From March 13th we have had 2 biweekly payrolls where I paid the 941 taxes and we have had 2 payrolls where I have taken the credit.   How do I go back and fix them so they go against the credit.  Hopefully I explained myself correctly.

Nick_M
QuickBooks Team

Will Quickbooks Online automatically handle and calculate the Employee Retention Tax Credit which is associated with the COVID-19 stimulus including on the Form 941?

Hello, LifeClinic4818. 

 

Thanks for stopping by the Community. I'm happy to see what I can do to help. What you'll need to do is go back and delete your payroll and re run it with your new ERC set in place. Follow the directions below. 

  1.  Click the Workers tab from the left menu.
  2. Select Employees list.
  3. Under Run Payroll, select Paycheck List.
  4. Change the date range if necessary, and then select the paycheck you want to delete.
  5. Click Delete.
  6. Mark the tick box to confirm the deletion, and then click Delete Paycheck.

When these steps are complete you can run a corrected payroll. Here's a video on that process.

 

 

If you have any other questions, I'm here to help. 

 

Thanks again for stopping by and have a nice afternoon. 

 

LifeClinic4818
Level 1

Will Quickbooks Online automatically handle and calculate the Employee Retention Tax Credit which is associated with the COVID-19 stimulus including on the Form 941?

Hi Nick,

 

Thanks for the information however that doesn't help me completely because you must have given me the instructions for the online version not the desktop so the steps are not accurate.  I will try to figure it out.

Anna S
QuickBooks Team

Will Quickbooks Online automatically handle and calculate the Employee Retention Tax Credit which is associated with the COVID-19 stimulus including on the Form 941?

Hi there, @LifeClinic4818.

 

I hope all is well. You can void a paycheck in QuickBooks Desktop even if the paycheck has been processed. You'll need to make sure you haven't made any changes to the check before you void it, or the process will be unsuccessful. I've included the steps below to show you how to void the paycheck using the Basic, Standard, or Enhanced Payroll:

 

  1. Press the Payroll Center icon.
  2. In the Pay Employees menu, navigate to Other Articles and pick Edit/Void Paycheck.
  3. Adjust your date range (paycheck date, employee, or check number) to the correct pay period of your desired check. 
  4. Click the paycheck you need and hit Void. The check will then display VOID: in the memo section.
  5. Push Done to close the edit window, then go to the Employees drop-down menu and choose to Send Payroll Data.
  6. Select Go Online, enter your Payroll Service PIN, and press OK.

 

Now, your employee's paycheck is voided, and you can rerun payroll to include the Employee Retention Credit. I've included an article that might be helpful in the process: How do I create a paycheck for an employee?.

 

Feel free to hit the reply button if you have any other questions or concerns. Take care.

Natlock
Level 2

Will Quickbooks Online automatically handle and calculate the Employee Retention Tax Credit which is associated with the COVID-19 stimulus including on the Form 941?

Having to go back to March and start deleting paychecks makes me very nervous. Are you sure this is the best way to handle this? If I send form 7200 to the IRS, can't you deduct from my tax deposits? I use Intuit Online Payroll so I can't control my tax deposits.

Nick_M
QuickBooks Team

Will Quickbooks Online automatically handle and calculate the Employee Retention Tax Credit which is associated with the COVID-19 stimulus including on the Form 941?

Hi Natlock. 

 

The information provided by my colleague is correct. It's important to note that the form 7200 is only required if you want excess credits to be used now rather than waiting until the 941 is filed. After the 941 is filed the IRS refunds after you reconcile the account. For additional information on the form 7200 check out the IRS website link, here

 

If there's anything else I can help with, feel free to post down below. 

 

Have a nice weekend.

akimyai
Level 1

Will Quickbooks Online automatically handle and calculate the Employee Retention Tax Credit which is associated with the COVID-19 stimulus including on the Form 941?

Nick_M, can you clarify your response above?

 

For this quarter, my ERTC amount will exceed my federal taxes owed.  So now I have a credit.

 

If I don’t file Form 7200, what will happen next?

Will the IRS refund me automatically for Q2?

 

Or can I have this credit roll over to Q3 (to be applied against  Q3 federal taxes owed)?

Catherine_B
QuickBooks Team

Will Quickbooks Online automatically handle and calculate the Employee Retention Tax Credit which is associated with the COVID-19 stimulus including on the Form 941?

Hello there, akimyai. 

 

Yes, the IRS will automatically refund the overpaid taxes. You also have the option to apply it to the next quarters liability. I've also added an article about the Families First Coronavirus Response Act and how you can apply it in QuickBooks. This act provides support to individuals and small businesses affected by COVID-19. Just follow the steps provided in this article to pay your employees under this act: Pay employees under the Family First Coronavirus Response Act.

 

If you have further questions or concerns, feel free to reach back to our Community site. We're always ready to provide you assistance. Stay safe.

akimyai
Level 1

Will Quickbooks Online automatically handle and calculate the Employee Retention Tax Credit which is associated with the COVID-19 stimulus including on the Form 941?

Thank you for your reply, but can you further address how I can apply my credit to next quarter’s tax liability?  I have QuickBooks Online Full Service Payroll.

 

The article you posted doesn’t specify the actual steps to exercise this option.  Furthermore, it refers to the FFCRA, not the ERTC, so I just wanted to make sure we’re on the same page.  Thank you so much!

Natlock
Level 2

Will Quickbooks Online automatically handle and calculate the Employee Retention Tax Credit which is associated with the COVID-19 stimulus including on the Form 941?

I was just about to fax Form 7200 to the IRS but thought I would reach out to Intuit Online PR one last time. I had to do a chat but the woman that helped me went into my account and retroactively (to March) and changed my employees to ERC and is submitting a corrected 941 for 1st quarter and will (hopefully) submit the correct 941 with the credits. It took about 30 minutes. Just as an FYI, I've reached out to Intuit 4 times and have received 4 different answers. Fingers crossed that this works because I did not fax the 7200.

ZackE
QuickBooks Team

Will Quickbooks Online automatically handle and calculate the Employee Retention Tax Credit which is associated with the COVID-19 stimulus including on the Form 941?

Hi there, akimyai. Thanks for bringing this question to the Community.
 

Employee Retention Credits can be applied to your next quarter's tax liability by applying an overpayment as a credit. I'll guide you through how it's done:
1. In the navigation bar on the left, go to Taxes.
2. Open the Payroll Tax tab.
3. Choose the Pay Taxes option, then locate the overpayment. It will display as a negative amount.
4. Hit Resolve Overpayment.
5. Click Apply to a future tax payment (recommended).
6. Select Mark as Resolved.
7. A message will be show advising that Intuit has updated your payroll information and to contact the tax agency. Pick Contact tax agency for next steps to complete the process.
 

Now your ERTC will be applied to the next liability period.
 

Here's a detailed resource about resolving overpayments: Resolving a tax overpayment in QuickBooks Online
 

Feel welcome to reach out to me here if you have any questions. Have a wonderful day!

akimyai
Level 1

Will Quickbooks Online automatically handle and calculate the Employee Retention Tax Credit which is associated with the COVID-19 stimulus including on the Form 941?

ZackE, thank you for your detailed reply, but it looks like your instructions are for Quick Books Online Payroll Enhanced.  I have Full Service Payroll and can't locate the tabs you are referencing.

 

Do you have detailed instructions for doing this under Quick Books Online Full Service Payroll?  Thank you so much!

 

JenoP
QuickBooks Team

Will Quickbooks Online automatically handle and calculate the Employee Retention Tax Credit which is associated with the COVID-19 stimulus including on the Form 941?

Hi there, akimyai.

 

The Pay Taxes tab or option is not available in the Full Service Payroll because your taxes are automatically being paid by Intuit. You can also see the prior tax payments and file submissions in your 

 

I can see that you're previously reached out to us about this issue. However, to help you adjust or apply the credit to next quarter’s tax liability, please reach out to our Payroll Support Team once again. 

 

Visit us again in the Community if you need anything else. 

AM20
Level 1

Will Quickbooks Online automatically handle and calculate the Employee Retention Tax Credit which is associated with the COVID-19 stimulus including on the Form 941?

How do I calculate the retention credit on Qbooks desktop.

Rubielyn_J
QuickBooks Team

Will Quickbooks Online automatically handle and calculate the Employee Retention Tax Credit which is associated with the COVID-19 stimulus including on the Form 941?

Hi there, @AM20.

 

Based on IRS, the credit is calculated as the amount of the credit is 50% of qualifying wages paid up to $10,000 in total. Wages paid after March 12, 2020, and before Jan 1, 2021, are eligible for the credit. Also, wages taken into account are not limited to cash payments, but also include a portion of the cost of employer-provided health care.

 

You'll need to calculate it then manually enter the amount inside QuickBooks Desktop when you run your payroll.

 

To learn more about retention credit, feel free to check out this article: How to set up and track the Employee Retention Credit under the CARES Act.

 

Let me know if you have other queries, I'm here to help you out. Have a nice day.

RR2448
Level 2

Will Quickbooks Online automatically handle and calculate the Employee Retention Tax Credit which is associated with the COVID-19 stimulus including on the Form 941?

I need to take ERC - for 2nd Quarter 2020

 

I see help for online payroll - I need help for Desktop enhanced Payroll

 

I think, I need to set up two payroll items - But I am unsure -

 

Can someone please provide a link to create various pay type / Retention credit for Desktop - there are some links - but when I click them - they come blank - " No help available"

 

any help is apprecaited.

 

Thank you

 

 

katherinejoyceO
QuickBooks Team

Will Quickbooks Online automatically handle and calculate the Employee Retention Tax Credit which is associated with the COVID-19 stimulus including on the Form 941?

Thanks for joining in this conversation, @RR2448. Let me provide an overview of the Employee Retention Credit under the CARES act. 

 

Under the CARES Act, a qualified employer may get a refundable tax credit. You may be able to offset the impact of COVID-19 with an Employee Retention Credit (ERC). Hence, you'll have to ensure first you're eligible for the credit before you can set up the ERC in your payroll. 

 

Additionally, make sure you have not availed a loan under the Paycheck Protection Program for you to qualify. Here's the link with more detailed steps under QuickBooks Desktop PayrollSetting up your payroll to accept and track the credit. It helps you learn about tracking eligible wages to use towards tax credit.

 

I'm also including these articles with information about the deferral of the employer share of 2020 Social Security taxes. Check to see if you're qualified for this too so you can track it:

 

 

Let me know if you have additional questions. We're always delighted to help. 

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