Setting up Bonus Paychecks in QuickBooks Desktop Payroll

by James Antonio

QuickBooks is another name that is part of an ongoing trend that will give you the best possible accounting experience. Be it income calculation, bonus paychecks or business purpose investment, every calculation will be accurate. You never have to be worried about the calculations ever again. Know more about Setting up Bonus Paychecks in QuickBooks Desktop Payroll.

Setting up Bonus Paychecks in QuickBooks Desktop Payroll

Bonus is a self explanatory term, which is a compensation over and above the amount of the specified payment for an individual. It can be calculated as a base salary or hourly rate. In other words, any amount that is extra to your specified payment will be considered as a bonus. We’ll show you how you can add a bonus to a regular paycheck without much of a problem and how you can create a separate bonus paycheck.

How You can Add a Bonus on a Regular Paycheck

Before you decide to give out bonuses to your employees on their paycheck, you may need to take some pre steps for the same. You should add the Bonus pay type to your employees’ profile. In case you already have done so, you may want to check the status of the bonus payment as well. There might be a possibility that the employee already has received the bonus pay (in the form of cash), then, you need to record the payment as a manual check and not as a direct deposit check.

In the version of QuickBooks Desktop Payroll, you can simply create a bonus payroll item in order to pay a bonus paycheck or simple paycheck to your employees. You need to follow these steps to set up a Bonus payroll item:

  • From the menus of QuickBooks Desktop at the top corner, you need to select Lists tab.
  • Choose the specific Payroll Item List.
  • Scroll down and at the lower left of the Payroll Item List, you need to choose the Payroll Item button and click on New.
  • Go on Custom Setup, and then click on Next.
  • Locate the Wage tab, and then click on the Next button.
  • Choose the Bonus tab, and then hit the Next button again.
  • Enter the specific name of this item, then click Next tab.
  • Choose the specified expense account you want the item to track to, and then select Finish.

Note: QuickBooks Desktop has advanced features and will automatically include this item if you are all set to calculate for Workers’ Compensation. If you wish to exclude the Bonus calculation in your Workers’ Compensation section, you should create the specific Bonus payroll item as an Addition coupled with a tax tracker type of compensation.

QuickBooks Desktop will enable you to choose from several options to pay bonuses to employees. You can choose the option that best fits your bonus situation:

  • Either you can pay a bonus on a regular paycheck.
  • You can also pay a bonus on a separate paycheck.
  • You can pay employees with a gift certificate or cash bonus.

Bonus Taxation options:

Once you have chosen the perfectly suitable method of paying the bonus, you should also consider the taxability of bonuses. Your net pay on a bonus check can have drastic changes on it on the basis of the selection and disbursal of taxes. You also need to check whether or not the bonus is on the same or separate check than the regular payroll wages.

Bonus checks are also subjected to normal tax deductions, including state and federal taxes. However these payments may be subjected to supplement tax deduction rates for federal and state withholding. On QuickBooks platform, any applicable state or federal withholding supplemental tax rate can not be automatically calculated on the given bonus wages. In order to calculate the supplemental rate, you must manually enter the correct amounts which are or should be calculated on the paycheck.

When it comes to paying a wage bonus to your employees, you have several options to count for. You can also choose to add the bonus pay to the employee’s wages. You can simply add the extra pay on the existing employee’s paycheck for the applicable pay cycle. You can also offer a bonus check that will be separate from the regular wages of employees’.

At any point, if you find the procedure to be too much to handle, then you can simply contact us, Dancing Numbers team. This team of experts has well trained personnel who are backed by their in-depth knowledge and rich experience of advanced level of accounting and calculations. All you need to do is to give us a call or fill the given requisition form with required details and leave it to our team of experts which will take care of everything else.

You can also go for some common questions that may pop up in your mind and you would go to the end of the earth to find the answer. Do not worry, we will try to list a few for you here.

How are Bonuses Taxed in QuickBooks?

Just like a salary, bonus checks are subject to normal tax deductions and are considered to be in the tax slab. It includes state and federal taxes. In QuickBooks, any of the state or federal withholding supplemental tax rate cannot be calculated on the bonus wages. That is something that has to be applied on the payroll calculations.

How to Run Bonus Payroll on the QuickBooks Desktop?

  • Firstly, you need to sign in QuickBooks account.
  • Then, you need to choose to Payroll then choose Employees.
  • Click on the Run payroll tab on the drop-down arrow and select Bonus only.
  • Locate and select either Net Pay or Gross Pay.
  • Hit the Continue button.
  • You need to enter the pay date.
  • After this, you can check the checkbox next to each employee to include in this bonus run.

How do You Put a Bonus on a Paycheck?

When it comes to paying a wage bonus, you have several options to consider. You can try adding the bonus in order to pay the employee’s wages. You also might simply add the extra pay on the employee’s paycheck for the applicable pay period.


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Why should do you change the Employee status instead of deleting them on QuickBooks?

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QuickBooks allows you to access almost all types of accounts, including but not limited to savings account, checking account, credit card accounts, and money market accounts.

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