How To Set up Payroll Items For Insurance In QuickBooks

WiZXpert is here again with the new article on payroll i.e, how to create or set up payroll items for insurance so that you can easily that you can add to employee profiles and paychecks. If you want to know about payroll in QuickBooks Desktop and Online in detail then go through our article How to do Payroll in QuickBooks Online and Desktop. The details of the item for payroll and setup are explained here to let you fix it up on your own for insurance in QuickBooks. Here we are to assist you if you need any help contact us on: +1-844-405-0904

Now, let’s get started with how to create or set up payroll items for insurance.

Payroll items included in this category:

  • 125 – Health Insurance (pre-tax)
  • 125 – Dental Insurance (pre-tax)
  • 125 – Other Premium Only Plan (pre-tax)
  • 125 – Medical Care FSA (pre-tax)
  • 125 – Dependent Care FSA (pre-tax)
  • Health Insurance (taxable)
  • Dental Insurance (taxable)
  • Vision Insurance (taxable)
  • Other Employee-Paid Insurance (taxable)
  • Taxable Group Term Life
  • Medical advantages for officers or 2% of shareholders (S Corporations only).

Note: If you do not know the plan and type of insurance that you are using, then you have to contact your plan administrator at your insurance company.

Steps to set up payroll items for insurance benefit item using EZ setup:

  • Go to the Lists and look for the Payroll Item List then later go to the Payroll Item button and later click on New.
  • Click on EZ Setup and choose to Next.
  • Now, go with all the onscreen instructions setup, that asked you to clarify a series of questions based on the item type.

Key points to remember:

  • After creating a payroll item, Intuit always advises you to edit the payroll item to enter all the necessary information.
  • If you need any help during setup, then look for the right side of every screen you will find Help topics click on it, you will get great assistance for set up.

Steps to set up payroll items for an insurance benefit item using Custom setup:

  • First, go to the List and later click on the Payroll Item List. Now look for the Payroll Item button and Click on New. 
  • Click on Custom Setup and later select Next.
  • Now, choose to Deduction and later, click on Next.
  • Now, you have to give any name to the deduction item and later click on Next. This name will display on pay stubs and payroll reports.
  • Insert the agency for the employee-paid liability, and the account number and the liability account for the payroll item. And select to Next.
  • Go to the Tax Tracking Type and click on the type needed for the accurate tax distribution. Choose on Next.
  • Note: In most instances, the tax tracking type is not for any post-tax health insurance reduction and pre-tax health insurance reduction and premium only / 125. If you want to know the taxability of the item then contact your health insurance administrator. 
  • Go to the Taxes window and do not make any change here with the taxes and Simply click on Next.
  • Note: QuickBooks Desktop itself auto-selects the accurate taxes. You don’t need to modify them.
  • Now go to the Calculated Based on Quantity window, click on Neither and then select Next.
  • In Gross vs. Net, if the value of the deduction is percent (%) of the employee’s gross earnings, then click on Gross. If the value is in the fixed dollar amount, then click on Net. If the calculation ranges from one employee to another, you have to set several items. The taxation of goods depends on the nature of tracking selected and not by gross vs. net calculation.
  • Now, insert the default rate only if all workers pay the same amount for health insurance. And later click on Finish
  • Add the item to the relevant employee profile and insert an amount for every payroll deduction.

Hope, this article will be helpful for you to Set up Payroll Items for Insurance. The above steps are very easy and simple to perform by themselves. But if you have any kind of issue or query while performing the steps or any accounting and bookkeeping-related issue then feel free to contact us on our toll-free +1-844-405-0904and quick assistance from our Intuit Certified ProAdvisors. Our certified team of ProAdvisors is always happy to assist you at any point in time.

Thankyou For Visiting WiZXpert!

CLOSE
Call Now