How To Set Up A Taxable Fringe Benefit Payroll Item In QuickBooks
Here are the details
Step 1 –
In the QuickBooks menu which is at the top, click on Lists > Payroll Item List.
Step 2 –
At the lower left of the Payroll Item List, click on the Payroll Item button then select New.
Step 3 –
now, select Custom Setup.
Step 4 –
Select Company Contribution or Addition, and then click on Next.
A Company Contribution item adds the value of the fringe to that has to be taxed but not increase the paycheck net pay, an Addition item adds the value of the fringe that has to be taxed and will increase net pay.
Step 5 –
Now enter a name for the item, for e.g., ‘Auto Compensation – Personal Use,’ then click on Next.
Step 6 –
Choose an expense and liability accounts from the drop-down menu, then click on Next.
Step 7 –
From Tax Tracking Type dropdown menu, select the Fringe Benefits and click on Next.
Step 8 –
Now, click on Next twice and this will bypass the ‘Calculate based on quantity’ window.
Step 9 –
If the amount will be a set amount, then enter the default rate in the first section of the Limit Type window.
Step 10 –
If there is a limit on the item, then enter the amount in the second section of the Limit Type window, click on Finish.
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