Let me share some information on how QuickBooks calculates payroll taxes, Andrea61.
I appreciate you performing the steps provided by my colleagues and downloading the most recent QuickBooks Desktop software release and Tax Table updates. This helps to keep your software up-to-date and to get the newest payroll tax table in your software.
When the payroll taxes are not deducting on your employee's payroll, it's possible the total annual salary exceed the salary limit or the gross wages of the employee are too low. Also, the Federal and State Income (FIT and SIT) taxes are calculated based on the following criteria:
- The agency's wage and tax calculation table.
- The employee's filing status, number of allowances, or extra withholding amount in the employee setup.
- Pre-tax deduction items were included on the paycheck.
- Changes in pay frequency (creating extra paycheck outside of normal pay schedule).
- Creating a paycheck with wages that has lesser or larger amount than what the employee normally gets in a pay period.
See How QuickBooks Desktop calculates payroll taxes to understand why paycheck shows the tax amount as $0.00 or under collected. We can try reverting the employee's paychecks to see if the payroll taxes are calculating. QuickBooks has an auto-calculation feature that carries over the underpaid taxes for the next payroll run. For other troubleshooting options on why payroll taxes are not withholding, check out these articles:
If the same thing happens, let's run the Verify and Rebuild Data tool in your QuickBooks Desktop. It could be there are data integrity issues for both company files causing this issue.
I'd like to know how you get on after trying the steps, as I want to ensure this is resolved for you. Just reply to this post and I'll get back to you. Take care always.
