We’ll need to create a bonus check, Angeatwork.
Bonus checks are subject to normal tax deductions, including state and federal taxes. We can either create it on a separate paycheck or a regular one.
We’ll need to create a payroll item first to offset the employee’s loan balance. Let me show you how:
- Go to the Lists menu and click Payroll Item List.
- Click the drop-down beside Payroll Item and select New.
- Select Custom Setup and then Next.
- Click Deduction and Next again.
- Follow the on-screen instructions.
- Let’s make sure to choose the loan account under the Liability account (employee-paid).
- Select to calculate it on the employee's net pay.
- Click Finish.
Create a bonus paycheck depending on how you'll want to record it. Select these options on the Paycheck window:
- Earnings: Bonus
- Other Payroll Items: deduction payroll item
Please reach out to me if you need more help handling your employee's pay.