How to update employee records after missing company contribution SIMPLE IRA payroll item was added

Welcome to the Community, @JeMidi.

In QuickBooks, standard liability adjustments primarily impact your Balance Sheet and Tax Center. However, these adjustments often do not update specific W-2 boxes (such as Box 12 or 14) because these boxes require a direct link to an employee’s payroll record.

To update the W-2s for 13 employees without generating actual payments, the $0.00 Net Paycheck method is the most effective solution.

To ensure the adjustment is tax-neutral and maps correctly to the W-2, follow these steps to modify the employee profiles:

1. Ensure the SIMPLE IRA (Company Contribution) item is added to each employee's profile and mapped to the correct tax category.
2. Add a temporary Other Earnings pay type (you can name it Taxable Offset). This will be used to balance the contribution to reach a $0.00 net.
3. To prevent the system from calculating unintended taxes (like Social Security or Medicare), you may need to briefly mark the employee as Tax Exempt in their profile or manually zero out the taxes during the payroll run.

Next, run the Adjustment Payroll using the steps outlined in this article: Create a zero net paycheck.

This process creates the necessary payroll event to automatically pull the company contribution into the W-2, providing a clear paper trail for 2025 and closing any reporting gaps before you file.

If you have any additional questions, feel free to revisit this thread.

Thanks for following up with these details, JeMidi.

I'm happy to provide some additional info to update the W-2s for your employees in QuickBooks Desktop Payroll.

In QuickBooks Desktop, you cannot save a paycheck with $0 total gross wages and a $0 net check, even if you are only recording employer contributions. The system requires a "positive" inflow of money to balance the "negative" liability/deduction, or it will reject the paycheck.
 

To achieve a $0 net paycheck that records the Employer Simple IRA contribution for W-2 purposes, you must create a "dummy" addition/other earning to act as a placeholder. This does not actually pay the employee extra; it just allows the check to process.

The following article offers even more info about setting up and managing company contributions. Please don't hesitate to reach back out if you need an extra hand.

Thank you @MorganB 

I now understand I can't create a zero dollar paycheck that only has a company contribution item, but I'm still not understanding how to set up a paycheck so the net effect is to only record the company contribution that we have already made and not have any payment to employee or other tax events.  The article you included was about creating and managing company contribution payroll item types, and I'm confident I've got that set up correct.

Can you provide more step-by-step on creating a paycheck that only records the company contribution for the retirement account?  For example @Jessavell_A mentioned creating a payroll entry to offset the company contribution, so do I need to create a new payroll item type?  And if so, what classification would it be from the list of type options?  

Let's assume I want to record a company contribution to the Simple IRA of $1000 for 2025 for an employee.  I would set up a paycheck for that employee to end on 12/31/2025 and I would set the employer contribution for the Simple IRA payroll item to $1000 but what do I put in the area for the employee's salary so that I'm not actually paying the employee but meeting the rules to create a paycheck?  

Also, we've already entered payroll data for our pay period ending 1/16/26 and it will process through quickbooks payroll on 1/23/26, so once I figure out how to processes these paychecks for the 2025 employer contribution do I have to wait and do it after our current payroll gets run?

Thank you both again for your help.

Hi @MorganB  I'm not sure if my last reply posted so if not here's a brief version: essentially I'm looking for help on creating the "dummy" entry to offset the employer contribution.  If I record an employer contribution of $1000 for the 2025 IRA company contribution, what do I do for the dummy; ie, what is the payroll item type (I assume it's for a value of $1000) so that nothing is paid to the employee and no tax events occur.  

Also- we've already entered our payroll data for the pay period ending 1/16/26 to run through quickbooks payroll for payments on 1/23/26 so do we need to wait until after that has processed before doing whatever we need to do for the 2025 IRA employer contribution fix?

Thanks!

Hello, @JeMidi.

I'm here to help you guide the creation of a new deduction payroll item to offset/zeroed out the net paycheck.

Here's how:

1. Go to List, then Payroll Item list. 
2. Click New. 
3. Choose Customer Setup, then hit Next.
   
4. Pick Deductions, then Next. 
   
5. Enter the Name for the dummy item, for example, "IRA Offset".
6. In the Tax tracking type, you can choose None. 
   
7. Hit Next until you reach the Gross vs. Net section. 
8. Select Gross pay, then click Next and Finish.
   

After creating the dummy item, go to your employee's paycheck details. In the Employee Summary section, you can edit the amount until it reaches zero. See screenshot:

To answer your question about waiting to process your 2026 entered payroll data to process the paychecks for 2025, you don't need to wait for January 2026 payroll to finish. You can run this as an Unscheduled Payroll for the 2025 date right now, as long as you use the correct 2025 dates; it won't interfere with your upcoming January 23rd disbursements.

If you have any questions or concerns, feel encouraged to let us know below.