How do I get past this error to proceed setting up QBO: The amounts entered may be incorrect. SS & Medicare taxes (FICA) are expected to be percentages?

So even if the percentage is incorrect, but the amount of taxes withheld for ss and medicare are different than what it should have been. Is there any way to get past this? 

(Coming from a 3rd party payroll and I have no idea what they did)

Hey there, MayenBusiness. 

What you'll need to do is take the gross pay of the employees that aren't calculating correctly and multiply that number by 6.2% for the Social Security and then 1.45% for the medicare. Take those numbers and place them in the SS and Med. boxes respectively, as my colleague mentioned above, the rates are set in stone, and if the gross pay is "X" than the SS and Med are also set numbers. I'm also going to include a helpful tutorial video below. 

If you have any other questions or concerns, feel free to respond below. Thank you for your time and have a lovely evening. 

If you do that, the net amount of the check is incorrect. Not sure that solves the problem.

Greetings,

QBO seems to make no allowance for accumulated rounding in these calculations.

When each paycheck is calculated, withholdings are only calculated to cents ... not hundredths or thousandths of cents. Over 30+ payroll periods, these small differences accumulate.

Then, when entering total gross wages over that period, it shouldn't be a mystery when 6.2% (for Social Security) or 1.45% (for Medicare) of the total gross wages is slightly different than the accumulated withholdings over each pay period.

The figures I'm entering are perfectly accurate for the totals of our payroll, but differ from QBO's estimates by mere cents. How is there no allowance for this accumulated rounding?

I'm here to provide some insights on how QuickBooks calculate taxes, JustBreatheAndRepeatYourself.

QuickBooks uses the more accurate percentage method and tax tables that are annualized (rather than weekly, biweekly, or monthly). It also calculates your payroll taxes on year-to-date amount instead of per transaction.

You may notice differences between calculations by QuickBooks and printed wage bracket taxes from agency publications. Both methods are correct and acceptable to the agency. 

The tax table:
 

• automatically adjusts many flat-rate taxes. Examples:
  • Social Security
  • Medicare (for Additional Medicare tax, check the User Guide for QuickBooks)
  • Federal Unemployment (FUTA)
  • State Unemployment (SUI - wage base limit only, SUI rate is unique to your business)
  • State Disability (except for HI and NY)
  • Predefined local taxes
• handles rounding discrepancies and retroactive tax rate changes for flat-rate taxes including FICA, FUTA, SUI, and SDI taxes (some SDI taxes are flat-rate).
   

Check out the IRS Pub 15 for Federal Withholding and State Agency's calculation method for the State Withholding calculation tables.

Additionally, it determines the rates and wage limits for Federal, State, and rate-defined local taxes.

If there's a need to correct your payroll calculations, I recommend contacting our QuickBooks Online Payroll Team. One of our Tax Team can pull up your and check your payroll data in a secure environment. 

Select your product and fill out the form to chat with an expert:

• QuickBooks Online Payroll
• QuickBooks Full Service Payroll
• QuickBooks Online Payroll Core
• QuickBooks Online Payroll Premium
• QuickBooks Online Payroll Elite.
  
  

Let me know if there's anything else I can help you with concerning payroll. I'll be right here to provide additional information about this.

That's fantastic news, and the (slight) increase in accuracy will be welcome.

In the meantime, we still need to complete a mid-year migration from our previous payroll system.

And the validator which reviews the figures we're entering fo year-to-date totals seems to have no allowance for fractions of cents (accumulated rounding).

How can we proceed to migrate to QuickBooks? Should we misrepresent the figures from our actual payroll?

I’m here to make sure you can proceed to migrate to QuickBooks, @JustBreatheAndRepeatYourself.

I appreciate you for sharing this matter with us. To complete the migration process, I’d recommend contacting our Payroll Support team. Our representatives can help and provide information to ensure the figures in your actual payroll are accurate.

Here’s how:

1. Select the Help menu.
2. In the Assistant window, type in “Talk to a human.”
3. Enter a brief description of your concern.
4. Enter/select I still need a human.
5. Click Get help from a human.
6. Choose Callback.

You can use this information to learn more about Social Security and Medicare (FICA) taxes in QuickBooks.

And if in case you want to know more about how QuickBooks calculate taxes, you can visit these resources to learn more:

• How to calculate payroll taxes
• What is payroll withholding and how do you calculate it?

Please don’t hesitate to let us know if you have other payroll questions or concerns. We’ll be here to help. Always take care!