How to Calculate Company Contributions Based on Employee Hours in QuickBooks

Using QuickBooks for Company Contributions to Employees 

Some companies (especially those with union employees) have to make company contributions based on hours worked. For example, the union contract may require you to contribute a certain amount to a health and welfare fund for each hour worked.

Create a QuickBooks payroll item of the type "Company Contribution" (these are not deduction type items). Specify the liability and expense accounts to track the contributions (we prefer to create separate liability/expense subaccounts for each payroll item.) Configure Tax Tracking as None, and make sure no checkmarks appear on the list of taxes affected. Step through the QuickBooks payroll item wizard to list the hours upon which the contribution is based. Assign the payroll item to the appropriate employees to have the contribution appear automatically in paychecks. The amount owed appears in the QuickBooks Pay Liabilities report.


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