cancel
Showing results for 
Search instead for 
Did you mean: 
cgg
Level 1

How to categorize Square Payroll Journal Entries

Square journalizes payroll entries a bit differently than ADP, etc. Here's an example:

(Please disregard the accounts used in the image, as I am searching for the proper ones to use.)

 

1.png2.png


Line 1 is the total amount (employee pay, employee taxes, employer taxes) withheld.

 

Line 8 is the total taxes owed by the employer. 


 Line 9 is the actual employee take home pay.

 

Line 10 is Federal Unemployment Tax, CA State Employment Training Tax and CA state Unemployment Insurance- all to be paid by employer.

 

Line 11 is Employee Social Security, Employee Medicare- to be paid by employee, and Employer Social Security, Employer Medicare- to be paid by employer.

 

Line 12 is CA State Disability- to be paid by employee.

 

What accounts (Wages expense-expense, Payroll tax-liability, etc) should be used to categorize corresponding lines?

 

Thanks in advance!

1 Comment 1
MaryLandT
Moderator

How to categorize Square Payroll Journal Entries

Good day, cgg,

 

I'm glad to help categorize those Square Payroll entries in QuickBooks Online.

 

You'll want to use these expense accounts to track payroll wages from your payroll provider:

  • Payroll Expenses: Wages
  • Payroll Expenses: Taxes

Then, use these liability accounts to specify federal and state taxes:

  • Payroll Liabilities: Federal Taxes (941/944)
  • Payroll Liabilities: Federal Unemployment (940)
  • Payroll Liabilities: [State] SUI/ETT
  • Payroll Liabilities: [State] PIT/SDI

You can also create new accounts if you haven't set them up. This will help track your payroll liabilities and expenses.

 

Then, proceed to Step 2 in this article: Manually enter payroll paychecks in QuickBooks Online. It provides instructions to help categorize the line items on your journal entry.

 

I also suggest consulting your accountant for specific instructions on what accounts to debit or credit.

 

Keep me posted if there's anything else you need. Just tag my name and I'm always right here to help.

Need to get in touch?

Contact us