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Community Explorer **

Additional states appeared in my payroll tax setup after changing employee addresses

In preparation for printing and mailing out my employees' W2 forms, I updated the mailing address of some seasonal employees who are living out-of-state. My business is in Minnesota and all of our operations are in-state. However, after changing those addresses in the Employee files, the two states where those employees are currently living (Oregon and Missouri) now show up in my payroll tax setup screen, and QB is prompting my to fill out tax ID numbers, UI account numbers, and tax rates for those states.

 

This doesn't make any sense. I do not operate in those states. I do not see any options to "Delete state" from my tax setup. QB will not let me proceed with any tax payments or returns until my tax setup is complete. The employment location for these employees is still listed as Minnesota.

 

As a test, I changed the employee address to something in Minnesota, and now that state disappears from the Tax Setup screen. But now the address for that employee is not correct.

 

So how do I include the accurate address for an employee without QB assuming that I also do business in that state?!

Solved
Best answer 01-24-2019

Accepted Solutions
QuickBooks Team

Re: Additional states appeared in my payroll tax setup after changing employee addresses

Hello again, @sognvalleyfarm.


I’d be glad to clarify why QuickBooks is prompting you to finish the payroll setup for Oregon and Missouri.


When setting up payroll, you’ll have to enter the necessary details including the work location and employees’ addresses.


QuickBooks generates the forms and taxes to set up based on the employees’ residence and work locations. Oregon and Missouri appeared in the Payroll Tax Setup because the employees were initially set up under these states.


We want you to stay compliant with your tax regulations, which is why the software will require and prompt you to enter the information for each state. Even if the business and employees are in different states, some agencies have reciprocity agreements and may require employers to file and pay taxes for each one.


Since there isn’t a way to delete the incorrect states, you’ll have to complete the payroll setup. Just make sure to enter 0 for the rates and dummy account numbers


We take into consideration our customers ideas when improving QuickBooks features. If you’d like to have the option to bypass the setup, I suggest sending feedback regarding this directly to our Product Development Team for consideration in future updates.


To submit, go to the Gear icon in the upper right and selecting Feedback. I will also send this on your behalf, that way they’ll receive multiple suggestions of how beneficial this feature would be.


Since you’ll be processing W-2s, I’m adding an article will help you seamlessly file them: Process and file W-2 forms.


If there's anything else I can help you accomplish, or if you have more questions about the product. I'll be happy to assist you further. Have a great rest of your day.

 

6 Comments
QuickBooks Team

Re: Additional states appeared in my payroll tax setup after changing employee addresses

Hello there, @sognvalleyfarm.

 

Thank you for posting here in the Community. Allow me to help share information about adding address to the employee's profile in QuickBooks Online (QBO).

 

Once you add an address to the employee's information in QBO, QuickBooks will automatically wants you to set up taxes for the address/state you've added.

 

If you wish to add the correct/accurate address, you may need to set up the taxes completely just make sure to input zero (0) on the tax rate, Tax ID and UI account numbers.

 

For additional reference about changing employee details in QuickBooks, you may check this article: Change employee details.

 

Let me know if you have any other questions about changing employee address in QBO. I'm always here to help!

Community Explorer **

Re: Additional states appeared in my payroll tax setup after changing employee addresses

Why would QB prompt me for tax info for those states? Just because employee permanent addresses are out of state doesn't change that fact that they're working and paying taxes in Minnesota.

 

Is there something I'm missing? Because I can't believe QB would design the software this way, and force me to fill in zeroes in the state tax info field to get around it.

 

Is this a bug?

QuickBooks Team

Re: Additional states appeared in my payroll tax setup after changing employee addresses

Hello again, @sognvalleyfarm.


I’d be glad to clarify why QuickBooks is prompting you to finish the payroll setup for Oregon and Missouri.


When setting up payroll, you’ll have to enter the necessary details including the work location and employees’ addresses.


QuickBooks generates the forms and taxes to set up based on the employees’ residence and work locations. Oregon and Missouri appeared in the Payroll Tax Setup because the employees were initially set up under these states.


We want you to stay compliant with your tax regulations, which is why the software will require and prompt you to enter the information for each state. Even if the business and employees are in different states, some agencies have reciprocity agreements and may require employers to file and pay taxes for each one.


Since there isn’t a way to delete the incorrect states, you’ll have to complete the payroll setup. Just make sure to enter 0 for the rates and dummy account numbers


We take into consideration our customers ideas when improving QuickBooks features. If you’d like to have the option to bypass the setup, I suggest sending feedback regarding this directly to our Product Development Team for consideration in future updates.


To submit, go to the Gear icon in the upper right and selecting Feedback. I will also send this on your behalf, that way they’ll receive multiple suggestions of how beneficial this feature would be.


Since you’ll be processing W-2s, I’m adding an article will help you seamlessly file them: Process and file W-2 forms.


If there's anything else I can help you accomplish, or if you have more questions about the product. I'll be happy to assist you further. Have a great rest of your day.

 

Community Explorer **

Re: Additional states appeared in my payroll tax setup after changing employee addresses

Thank you for the explanation. I don't know anything about reciprocity agreements, but it seems hard to imagine that I would have  to apply for an employer identification number in another state just because a seasonal employee happens to have an address there. So there should certainly be a way to specify that an employee's address is simply the permanent mailing address for payroll-related mail.

 

It feels not just "messy" to enter dummy numbers into QB, but also potentially legally worrisome, since I use QB directly connects with tax agencies for e-filing. 

Community Explorer **

Re: Additional states appeared in my payroll tax setup after changing employee addresses

This is very poor design. I'm really not comfortable entering dummy numbers for state tax agencies given that QB e-files many things for me. I am a very small business but often employees come to work seasonally from 3-4 different states each year. Simply including a mailing address for an employee shouldn't automatically affect my core state tax setup.

 

I am honestly not encouraged file formal requests to QB, as there are seemingly critical issues (such as absence of support for filing 943 forms) that have drawn requests for almost a decade with no response from Intuit. Just doesn't feel worth my time.

QuickBooks Team

Re: Additional states appeared in my payroll tax setup after changing employee addresses

Hello there, Sognvalleyfarm.

 

As what my friend @Rasa-LilaM provided, some agencies have reciprocity agreements. This means that the employee only pays taxes in one of those states. Though, some states don't. The employee's withholding will be based on both the state of residence and the state of employment.

 

You may want to contact your state agency about this matter. Or, you can consult your legal adviser or accountant about this.

 

For now, only the Desktop version allows you to file and process the 943 form. Though, you can download the form from the IRS website.

 

We always appreciate customers who take the time to give us their feedback. The more requests a feedback has, the more likely it will be added to the next update. If you haven't submitted any feedback yet, you can do that by clicking on the Gear icon, then choosing Feedback.

 

I'll help you by passing your feedback to our management team. 

 

You're always welcome to post anytime if you have other concerns. Have a great day! 

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