Intuit's change with automated tax withdrawals just announced

Welcome to the Community, @blazejay.

I'm here to provide information regarding these updates with the automated tax withdrawals in QuickBooks Online (QBO).

Please know that this change is being made to simplify payroll. You don't need to keep track of different taxes and payment dates. You're less likely to miss tax payment notifications and face unexpected withdrawals. You'll know the exact amounts needed for payroll and taxes each time you run payroll. Lastly, QuickBooks will schedule and pay taxes on time using the withdrawn funds.

If you'd like to share your thoughts or experience about this change with automated taxes, please pass this feedback on to our Product Development Team. Here's how:

1. Click the Gear icon and choose Feedback.
2. Enter your feedback Suggestion.
3. Press Next.

If you want to opt out of this change, you can turn off Automated taxes and forms in Payroll settings. You can read this article for a detailed process: Set up QuickBooks Online Payroll to pay and file your payroll taxes and forms.

Please let me know if you need clarification about the update with payroll taxes or if there's anything else I can do for you. I'll be standing by for your response. Stay safe always.

Hi Carneil, thanks for the response.  My question is about why the tax withdrawal schedule has been changed, and why the amounts are going to be taken out at the time of payroll instead of at the actual due date, as they are now.  I have no problem currently keeping track of different taxes and payment dates, so I'm not sure why the change has been made, as there is no tangible benefit to me.  

This is complete BS!  You are telling me that you will be withdrawing my company's payroll taxes before they are due, holding that money (and earning interest on it, most assuredly,) and NOT paying interest to me?  This cannot be legal!  Your customers need to understand what you are doing, here:  taking our payroll tax money early, earning interest until the payroll taxes are due, and NOT paying any interest to us for using our money.  Whoever came up with this idea should go to jail. 

Not only is there no benefit, Intuit will be taking your money weeks before your taxes are due and most likely using it to earn interest.  I cannot believe this is legal. 

This is an absolute garbage decision. It was made so that Quickbooks can earn interest on your businesses money. This is only going to hurt small business owners who may already have cash flow restrictions. Making a huge tax bill due at the same time as we are trying to pay our employees will just hurt and possibly destroy our business.

We originally started using QB Payroll because they did NOT do this. The reason we pay for QB payroll is to automate taxes etc. To tell us we can opt-out by manually filing taxes takes away the reason we use QB payroll in the first place and is a slap in the face to subscribers!

And they reframe it as "doing users a favor", total hogwash. Bookkeepers are very organized and reliable people who have no problem figuring out when a tax is due.

We may have to find another payroll provider, as QB payroll is getting worse all the time. 

QB is really intent on turning into a money-grubbing garbage product, not to mention all of the Ads I have to X out of now, just to continue working.

This is ridiculous!

@blazejay  RE: My question is about why the tax withdrawal schedule has been changed, and why the amounts are going to be taken out at the time of payroll instead of at the actual due date, as they are now.

This way Intuit gets to deposit your money into their accounts and sit on it until it's due, often for months. This way, they get to earn interest on the money instead of you! Pretty cool, isn't it?!

Rest assured, you'll learn to like it! It's simpler, and more streamlined, so that makes it better. People are saying. Everyone, really.

This change is NOT being made to simplify payroll. This change is a money grab by Intuit, so they can hold our business funds and earn interest off of the money, instead of US, their customers being able to use the funds as we see fit until the funds are due to the IRS. 

Here's what people in the real world understand this to mean...

QB will process your payroll, in whatever manner they've done before.  They will still calculate the tax amount.  They will even still prepare your tax filings (the federal and state payments).  That's where it stops.  With this change, if you don't agree to let QB take your money as soon as you process payroll, you'll have to log back into QB at a later date or manually schedule the process yourself.  This is being done DESPITE our state laws that don't always require immediate tax payments.  That's the cash flow problem people are talking about.    

Here's the problems I see:

1. You signed up for QB Payroll Automated so that YOU didn't have to worry about payments and filings - Now, you do.  

2. If YOU miss making or scheduling a payment or filing, YOU get hammered with the fines and penalties from the government.

3. YOU now have to take more time out of your day to manage your payroll taxes and filings.  This is a hassle which is precisely why most people signed up for QB's automated tax subscription.  

4. QB gets to take your money x-number of days early, earn interest on it, and then pay your taxes when they're due. 

• The withdrawn tax funds will be used to schedule and pay your taxes when due.

Oh, plus you have to keep paying your subscription costs, which have also increased.

Shame on you QB.

Careneil_C, were you going to answer the question and clarify *why* Intuit is doing this?  

Hey there, @blazejay.

I'd like to take this opportunity to share some significant details about the recent changes in the automated tax withdrawal process in QuickBooks Online Payroll.

We are streamlining the process of payroll tax management for QuickBooks Online Payroll customers. Instead of waiting for specific tax due dates to withdraw and pay taxes, we have implemented a new system where taxes will be withdrawn every time you process payroll or when taxes need to be updated.

Moreover, this enhanced system provides greater visibility, allowing you to view the withdrawal amounts when running payroll and review previous withdrawals in the Payroll Tax Center. These funds will be kept in a designated holding account until they are due to be remitted to the tax agencies.

Also, we ensure that payroll tax payments and filings are submitted on or before their due dates, factoring in each agency’s lead time. For customers who have Auto Pay & File turned on, tax payments are handled automatically.  If you opt-out, you must manually submit payments on time.

In addition to that, it's important to note that if you have Auto Pay & File turned on, you will not have the option to opt out of automated tax withdrawals. However, should you decide to turn off Auto Pay & File, you will have more control over when your payroll taxes are paid and filed.

Lastly, I've added this resource you can browse just in case you want to opt out of this change and don’t want automated tax withdrawals: Set up QuickBooks Online Payroll to pay and file your payroll taxes and forms.

I'll always be around any time you require additional assistance with the payroll taxes in QuickBooks Online Payroll. Let me know in this thread so I can further back you up.

@Sherrie_F  

There is really no point in copy/pasting the same corporate-speak answer that @Carneil_C  posted. It's just irritating and clearly, obviously false.

Hi Sherrie, thanks for the response.  Are you able to clarify *why* this is happening?  It is not a customer improvement from my perspective.  It seems to only benefit Intuit, for the reasons pointed out by some of the responders here.  

I appreciate your continued participation and sharing your perspective in this discussion, Jay. Allow me to address the recent changes made by Intuit regarding the automated tax withdrawal process to facilitate the payroll procedure.

To further discuss, here are the main reasons behind this change.

Firstly, the new system simplifies tracking by consolidating payroll and tax amounts, eliminating the need to monitor and manage them separately.

Secondly, there is a lower chance of missing tax payment notifications or facing unexpected withdrawals by withdrawing tax amounts at the time of payroll. Doing this will help avoid any last-minute surprises.

Lastly, QuickBooks will automatically schedule and pay taxes on time, using the withdrawn funds to ensure prompt tax payments and prevent insufficient funds.

With these changes, your general experience with automated tax withdrawals will be enhanced.

Additionally, you can have the option to turn off the automated taxes and switch to manually file and pay your payroll taxes by checking out this article: Set up QuickBooks Online Payroll to pay and file your payroll taxes and forms.

Your point of view about this automated tax withdrawal announcement matters to us. If you require further clarification, we're here to lend a hand.

I agree... this is sooo wrong!

There are SERIOUS problems if Withholding is not sent in!   I WANT TO DO THIS!    I have had enough problems with Quickbooks to trust them with this!

I'm fine with reminders and them filing tax forms.... I don't want them controlling my money!!!!

--- VKochetta

My guess is Intuit has decided to handle the payroll taxes like all the other payroll providers do.  They all pull the taxes with each payroll run and remit to the agencies when due.

First and foremost; Please explain HOW is this more simplified for me?  I am very sceptical as:  

• I have NEVER not had enough money in my account to cover the taxes; so that is not an issue for me.
• Currently my taxes are calculated and the withdrawal matching the amount due is made.  Easy.  How will I reconcile this payment now?

My other concerns center on how this money will be held:

• If Intuit fails, how do i get my money back?
• What bank is holding these funds?
• How are the accounts at the bank where the funds are held set up? 
• If the bank were to fail, would my funds be insured?

I don't like this at all. 

You are taking my money WAY IN ADVANCE and now you will be earning interest on my tax payments.

This hurts my cash flow and I have NEVER not missed a tax payment or had any issues at all.

I'm upset and will start looking for another alternative.

It's total BS. I can't believe it's legal.  I found a local accountant who will do all of my payroll tax payments and returns for the same amount as QB and I will cancel this service with QB, too.  I hope everyone cancels!

There is NOTHING about this that "enhances" my experience.  You, taking my money weeks before it is due is NOT enhancing.  It sucks.  I keep seeing on these boards how much Intuit cares about customer-input but they never actually listen to their customers and make changes we like or keep things the way we like them.  I've been a QB customer for 25+ years and am really at my wit's end--these policy changes are pathetic. 

Done with quickbooks as a whole. I now get hit with quarterly taxes, two weeks later the balance from the new quarter AND then pay as I go. This is a pure money grab, and I am done with it. 

I absolutely don't like this new "payroll tax holding" that Intuit is implementing starting October 1.

I have never missed a tax payment and this new way KILLS my cash flow.

Now, I'm certain that you will be putting the millions of dollars you will be withholding until payments are due in an account and drawing interest.

I am disappointed and will be looking for another alternative.

Does this change apply to Quickbooks Desktop clients with assisted payroll? 

I appreciate you for reaching out here in the Community, amzPWA. Let me provide you with information about the changes in automated tax withdrawals.

The changes mentioned will only have a specific impact on QuickBooks Online Payroll customers. QuickBooks Desktop users with Assisted Payroll will not be directly impacted by these sudden changes.

QuickBooks Desktop Assisted Payroll is a payroll service that takes care of processing and submitting tax forms and making payroll tax payments on behalf of the employer. It is designed to be the easiest to use, as users only need to review employee hours worked, run payroll, and pay via direct deposit or printed paychecks. At the same time, QuickBooks handles the rest of the payroll tax responsibilities.

Existing QuickBooks Desktop Assisted Payroll customers can continue their active subscriptions, and this change will not affect their ability to use the product or get support.

For more information about the changes in automated tax withdrawals in QuickBooks Online: Changes with automated tax withdrawals in QuickBooks Online.

Don't hesitate to come back here in the Community if you have other clarifications regarding the changes of automated tax withdrawal of QuickBooks Online.

How many new businesses will this policy close? How many startups have the cash flow to handle this kind of a cash hit out of the blue? There was NO warning for me, I got nothing until it was a week away from happening. Way to go helping the small guys…