My Quickbooks started deducting state unemployment insurance on direct deposit vendor payments. What happened and how do I fix it?
Hi there, northwestmed.
In QuickBooks Desktop, only employees are subject to State Unemployment Insurance deduction. You might want to check if your vendors were set up as employees by following these steps:
You can also check this article for more information: Write a Check in QuickBooks Desktop.
I'll be around if you need more help with QuickBooks. Thanks.
Thanks. This vendor in question was once an employee, but is now a contractor. So his social security number/TIN etc. is still in QuickBooks as a "released employee." The bill and subsequent payment is entered under his new vendor (as a 1099 vendor) under the same social security number/TIN. We've been paying this vendor via direct deposit for the last two years and this is the first time State UI has been deducted from his direct deposit which tells me this is from a recent change in QB. Do you think it's because the TIN matches an old employee profile?
Hello there, northwestmed.
Thank you for getting back to us with additional details. It would be my pleasure to help figure out why it's deducting State UI on a bill in QuickBooks Desktop.
The information reflecting on your bill should only be items included when you pay them. You can try checking the transactions of the contractor you used to pay as an employee to ensure there's no mistake.
If you're still unable to figure it out by following the steps above, I recommend calling this time. Our Phone Support Specialists will be to check the transaction through our system and provide a solution for the issue.
You can reach them through these steps:
Please feel free to post any questions you have below. The Community will be here anytime for you.
The former transactions were payroll transactions. The current transactions are a bill and bill payment for professional consulting services. Again, we've been paying this vendor for the last two years in exactly the same manner without this issue. Now (this week), upon sending a direct deposit, State UI is being deducted. It doesn't make any sense to me unless an update from QB (which has taken place between this vendor payment and the last) has changed something (possibly linking the TIN from a released employee to the same TIN now used by the vendor, namely his SS#). Thanks for your help.
I called the payroll assist folks. The vendor payment preview showed a deduction for State UI without any explanation. Apparently, there was a previous overpayment for State UI, and the "deduction" was the amount QB was crediting the company account while covering the full vendor payment. So the total vendor payment (preview) looked like is was less the State UI deduction, while the confirmation of the sent payment showed the full payment was made. A more detailed explanation from QB would have saved myself and QB a lot of time. :manwink:
Allow me to join the thread, @northwestmed.
I'd love to check this for you, however, I don't want your information to be displayed here for the security of your account.
Glad to know that our Payroll Team was able to check the deduction as well as the previous overpayment.
Please know that our doors are always open here in the Community. Stay in touch if you have any other concerns in the future. I'd be glad to keep helping.