Adding Payroll Garnishments - QuickBooks

Adding Payroll Garnishments

You may have received a letter stating that you must deduct an additional tax amount from an employee's paycheck due to outstanding amounts due to tax agencies. The Wage Garnishment Order will provide the necessary information, such as the account or case number, for how to post the money. If you have multiple employees that has this type of garnishment, you should create a new payroll item for each employee. Each item can have the employee's initials in the name of the payroll item, e.g., TAX LEVYAKA. Set up a Payroll Garnishment Item Set up a deduction item to garnish the employee's wages to pay creditor garnishments (for example, child support payments). Before you set up the wage garnishment item, create a record for the payee or vendor (if it doesn't exist) to whom this payment is due. 1. Go to the Employees menu, click Manage Payroll Items and then click New Payroll Item 2. In the Add New Payroll Item window, click EZ Setup and then click Next

3. Click Other Deductions and then click Next

4. In the Add New window, click Wage Garnishment and then click Next

5. Follow the onscreen instructions to complete the Set up the payment schedule for wage garnishment section and then click Next

6. Click Finish 7. Edit the employee's record to include the new garnishment item. Updating the Name of the Payroll Item At this point QuickBooks has created a payroll deduction item in your Payroll Item List called Wage Garnishment. You will probably want to edit this item, changing it's name to something more meaningful ? perhaps something like Employee X Child Support OR Employee X CS. 1. Go to Lists 2. Payroll Item List 3. Locate Wage Garnishment and double-click on it to Edit. 4. In the Enter Name for Deduction field (it will say Wage Garnishment) just type in Employee X CS 5. Then click the Next button

Before you can use this Payroll Item you first need to set-up a new sub-account of the normal Payroll Liabilities account in the Chart of Accounts. Keep clicking the Next button on the following windows, changing nothing, until you arrive at the last window; where you will select Finish.

Adding the Child Support Garnishment to the Employees Record

1. From the Employee Center, find and Edit the Employee 2. Switch to the Payroll & Compensation section by using the Change Tabs drop down menu 3. Click into the Additions, Deductions & Company Contributions section 4. Item Name column, select the deduction item, and give it an amount.

Each week when you run payroll, the specified amount will be deducted from the employees paycheck and sent to the Liability account and will be shown on your Chart of Accounts or a Balance Sheet Report. To actually generate the check to be sent to the Agency collecting the money, you'll go to the Payroll Tab of the Employee Center and select it from the Pay Scheduled Liabilities section.

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