Should our gross payroll expense include our employee’s deductions? Or should we consider the net pay to employee as our payroll expense? The employee’s withholding was paid directly by paychex. Is that part of our payroll expense too? What would be the journal entry in QuickBooks?
You really should enter each payroll individually, otherwise reconciling your bank account is going to be a nightmare. In this case, I recommend entering a check for each debit from your bank account. You’d enter the gross payroll as a positive number and employee withholding as a negative number. The net check would be what was actually debited from your account.
When you pay your payroll taxes ($59903.30) you’d enter two accounts – $50558.74 for payroll tax liabilities and $9344.60 for payroll tax expense.
But if you want to enter a journal entry for the entire year, it should look like this:
Debit – payroll expense ($168000)
Debit – payroll taxes ($9344.60)
Credit – bank account ($177344.60) – $117441.26 net pay + $59903.34 payroll taxes
I recommend switching to QuickBooks Assisted Payroll. It’s integrated with QuickBooks so you don’t need to enter journal entries. It’s also less expensive than Paychex.
Here are the standard fees. We can get you 20% off your monthly service fees for the first year:
News Flash – IRS Won’t Require Reconciling 1099-K Reports on Credit Card Payments with Gross Receipts
It looks like the IRS is dropping the requirement to reconcile 1099-K. The IRS recently sent a letter to Susan Eckerly, senior vice president of public policy at the National Federation of Independent Business, IRS deputy commissioner for services and enforcement Steven T. Miller, wrote:
“Thank you for your January 18, 2012, letter concerning proposals that Forms 1120 and other business income tax forms require a reconciliation of gross receipts and merchant card transactions,” he wrote. “As you know, we announced in October that no reconciliation is required on the 2011 income tax returns. In your letter, you raised whether we would require reconciliation for future years and outlined potential business impacts if we pursued such reconciliation.
“This is to confirm what I stated in our recent meeting with your organization and other industry representatives,” Miller added. “There will be no reconciliation required on the 2012 form, nor do we intend to require reconciliation in future years. Our intention is that the reporting of gross receipts and sales on the 2012 income tax forms will be modeled on the 2010 income tax forms. No other changes to these forms related to payment card reporting are contemplated.”
You can set both in Edit > Preferences > Send Forms. The QuickBooks Email option is on the My Preferences tab. The default templates for emailing forms is on the Company Preferences tab.
Make sure to bcc yourself on the default templates so you’ll know the forms were successfully sent.
You have to take a bad debt adjustment if you aren’t paid. That’s why it’s so important to use credit memos to write off bad debts.
Looks like Intuit’s working on a new QuickBooks Company File Diagnostic Tool, called File Doctor Tool for QuickBooks. The following was posted on Intuit News Central’s blog for a few hours this morning before suddenly disappearing, so I guess it’s not quite ready for prime time.
The QuickBooks® File Doctor troubleshoots problems opening your company file. It is essentially an improved version of the Company file Diagnostic Tool or Network Diagnostic Tool. The QuickBooks File Doctor will help find and fix data corruption and network setup issues. This tool can be used on company files with the extension .qbw or .qba, so you can use it on an accountant’s copy file too! Of course, you will want to use the File Doctor on your client’s PC or server.
The QB File Doctor specifically tests the success or failure of the following:
- Find at least one working TCP/IP adapter and that the hostname of the local machine is resolvable.
- Determine if the QuickBooks PortFinder service in Windows is responsive.
- Check if Windows can produce an IP address from a hostname and reverse the process.
- Check if Windows Firewall is enabled. If so, check if it’s configured to work with QuickBooks.
- Check for other firewall software: Norton, McAfee, Zone Alarm and Trend Micro.
- Check if the Sybase Database Service is reachable and responsive. Note: The Sybase Database service works directly with QuickBooks.
- Check for read/write access to the folder the company file is in.
- Check that QuickBooks hosting mode is active on the server, but not on the client computer.
- Check to see if the company file will open.
I have a new client- just for bookkeeping and I was trying to be perfect. I journalized the 12/31/10 tax return information so that I would have all the correct balances for the Balance sheet ….but behold the bank balance appears to be a plug on the tax return..it doesn’t agree to the adjusted bank balance.
QuickBooks wants us to input the prior months ending bank balance and now the bank account balance is out of whack – any suggestions.
How you increase a loan balance is to either use it as the From Account on a deposit if you received cash, or use it on the purchase transaction (bill or check) if the loan was used to purchase something.
We received our 1099K from the QuickBooks Merchant Providers (Innovative Merchant Solutions LLC). We also see on our corporate return (IRS Form 1120) that starting next year we will need to enter the amount of funds we received from the merchant provider per the 1099K, then also enter the amount received through non-merchant transactions. Since we are on an accrual basis, have a huge amount of accounts receivable per month and also deal with sales tax, going from our bottom line on our P and L to calculating the amount received through non-merchant transactions and the amount on the 1099K will be an astronomical task. The IRS’ definition of Gross Sales will also make this task difficult. We will be required to add back in each return. This will have to be done with a review of each days receipts. Fortunately we have not done summary entries into QuickBooks financial and have all the detail there. Is QuickBooks working on a solution for this? Especially since we have QuickBooks POS, QuickBooks Financial and QuickBooks Merchant Services, we are hoping there is a work around or a report that calculates this in our future. Fortunately it is not required this year or we would be scrambling to reconcile things. Given our volume of transactions, we cannot wait until the end of next January, when we receive our 1099K, to reconcile this amount and have our information to the CPA by mid February, in order for them to do our return by 3/15. We will probably tackle this as each merchant statement posts, but this is still a HUGE task. Please review form 1120 and the instructions as needed. Having a work around available would be a HUGE incentive to going 100% QuickBooks (Financial, POS and Merchant Services). A big selling point I would think. Since you are so well connected with QuickBooks I thought I’d start by asking you.
Trying not to panic…