Learn about reimbursements and how to pay your employee back for out-of-pocket expenses in QuickBooks Payroll.
Reimbursements are non-taxable payments you pay to your employees if they've paid business expenses out of their own pockets. This type of payment doesn’t appear on any of your payroll tax forms. For guidelines on reimbursements, check the Employee business expense reimbursements section of IRS Publication 15, Circular E — Employer's Tax Guide.
If you have QuickBooks Desktop Payroll, you can create a taxable reimbursement item, see Add fringe benefits to paychecks.
We’ll show you how to reimburse your employees in your payroll product.
|Note: Not sure which payroll service you have? Here's how to find your payroll service.|
Reimburse your employee
Step 1: Create a reimbursement item
Step 2: (Optional)Define accounting preferences
For accounting purposes, you can update your accounting preferences to make sure the reimbursement amounts post to the correct account in your chart of accounts.
Step 3: Run payroll with a reimbursement amount
Now that you’ve added the reimbursement pay type and updated the accounting preference, you’re ready to reimburse your employee.