How To Setup Health Insurance Contributions And Deductions In QuickBooks Payroll?
Easing the payroll activities to their maximum levels, QuickBooks Payroll comes with a bundled features for all businesses of all sizes. Within the least of time, you can effectively exercise a lot of tasks without costing much effort and time.
Dancing Numbers helps small businesses, entrepreneurs, and CPAs to do smart transferring of data to and from QuickBooks Desktop. Utilize import, export, and delete services of Dancing Numbers software.
One such time-consuming task is setting up the health insurance contributions and deductions in QuickBooks Payroll. This article will guide you with detailed steps on how to set up the health insurance contributions and deductions in QuickBooks Payroll.
What are Health Insurance Contributions and Deductions in QuickBooks Payroll?
On QuickBooks Payroll, You will be able to Set up Health Contributions along with their deductions to your Employees’ Payroll. To do this, you would be needing to first set it up on your payroll after you have sent them the Paychecks. Once you have added them to the payroll, you need to start adding each Contribution and Deduction to your Employee’s Paycheck.
While adding, you can choose What Health Insurance benefits you would be willing to offer to your Employees via QuickBooks Payroll. There are Multiple Choices of National Insurance from which your Employees can choose from and has Multiple Plans or Schemes that suits your Employees Interests.
For Setting up Deductions in QuickBooks Payroll and pay for the Insurance Plan Automatically for your Employees, You need to hover over the Paycheck Section.
Scroll further to learn more about How to Set up the Health Insurance Contributions and Deductions in QuickBooks Payroll.
Why do you need to Set up Health Insurance Contributions and Deductions in QuickBooks Payroll?
When asked why do you need to set up Health Insurance Contributions and Deductions in QuickBooks Payroll, there are very distinctive two major reasons that surface; the first one has already been subtly mentioned above which is primarily saving time, efforts and costs.
Setting up health insurance contributions and deductions in QuickBooks Payroll can be a time-consuming task, and thus in a business, you cannot afford to invest so much time into manual processes and need robust software to get the job done in the least time.
Thus, QuickBooks Payroll software can be considered as one such tool to make this happen. Apart from saving cost, time and standing out as a robust software, setting up health insurance contributions and deductions in QuickBooks Payroll also helps you in administering and tracking benefits which it has to offer beyond the plan.
How to Setup Health Insurance In QuickBooks Payroll?
To get started with setting up health insurance contributions and deductions in QuickBooks Payroll, here are the steps mentioned below for the same:
Step 1: Open QuickBooks Payroll and find Employees which is located on the left side of the window.
Step 2: Choose the respective Employee for whom you are making the contributions and tap on Edit.
Step 3: Go to a new window and choose the option that claims, ‘Does this Employee have Any Deductions?‘
Step 4: Click on the pencil icon or Add a New Deduction.
Step 5: Under the drop-down of Deduction / Contribution, Choose either Deduction or Contribution as Per Your Preference.
Step 6: Tap on Health Insurance which you will find from the drop-down of Deduction/Contribution.
Step 7: Choose:
- Vision Insurance
- Medical Insurance
- Dental Insurance
Step 8: Provide a label that must contain the name and description of the respective Health Insurance plan which has been opted for
Step 9: Under Amount per Pay Period, tap on $ amount/per cent of the total of gross pay along with in the next step the actual amount/percentage that needs to be contributed. You can wish to edit the amount at the time of generation of the paycheck thereby further mentioning the actual annual amount of deduction which the employee can choose for or the company is willing to contribute.
How to Add, Edit, and Track Your Insurance Benefit Plan in QuickBooks?
For your insurance benefit plan in QuickBooks Online Payroll and QuickBooks Desktop Payroll, you should know how to set up and manage payroll items and to know how to track and tax them appropriately. You might need to set up items in QuickBooks to track if your company offers insurance benefits.
Below are the steps mentioned on how to add, edit and track your insurance benefit plan in QuickBooks?
Step 1: Choose Which Health Benefits to Set up
- Plans for Section 125 (Cafeteria Benefit Plans)
- Health Insurance (Taxable or Pre-Tax)
- Dental Protection (Taxable or Pre-Tax)
- Vision Protection (Taxable or Pre-Tax)
- HSA Plans
- Pre-tax HSA
- Taxable HSA
- Company HSA
- Flexible Spending Accounts (FSA)
- FSA for Dependent Care
- Medical costs Medical Care Flex Spending and FSA
To find out more about Your Policy, Speak with the provider of Your Insurance Plan.
Step 2: Set up a Vision, Medical, or Dental Insurance Payroll Item
Follow the steps that are mentioned below to Add a Payroll Item for Medical, Vision, or Dental Insurance, once you will know the details of the Insurance Benefits from your provider.
Check out the items to Set up a Health Savings Account (HSA) or a Flexible Spending Account (FSA) for more information.
QuickBooks Online Payroll
Note: Use the vision insurance item for any other pre-tax insurance not included in QuickBooks.
- Select Employees and then Payroll.
- Now you have to choose an employee.
- To start or edit a Deduction or Contribution, Choose Start or Edit.
- Select + Add Contribution/Deduction.
- Now you have to choose the following options from the drop-down menu:
- Contribution/Deduction: Include Contribution/Deduction
- Type of Deduction or Contribution: Health insurance
- Choose Dental Insurance, Medical Insurance, or Vision Insurance.
- Enter the Provider’s Name in the Description (Appears on a Paycheck) area.
- Enter the Amount or Percentage Per Paycheck after Choosing a Flat Amount or Percentage of Gross Pay.
- Choose between Pre-Tax and Taxable Insurance Premiums.
- Add an Amount or Percentage every Paycheck for the Company Contribution if you make a Matching Contribution.
- When It’s Done you have to choose to Save and then click on Done.
QuickBooks Desktop Payroll
Step 1: Set up the Health Insurance Items
If your Employee Contributes to their Health Insurance Plan, Create a Deduction Item. Create a Company Contribution if your Company also Makes Contributions.
Set up a Health Benefit Insurance Deduction Item
- Payroll Item List can be found under Lists.
- Choose New from the Payroll Item dropdown▼ menu.
- Next, You have to choose Custom Setup.
- Then you have to select Deduction or Company Contribution.
- Select Next after entering the item name, such as medical, vision, or dental.
- Choose (or add) the agency’s name, the account number, and the recipient of the responsibility payment. Next, you have to choose next.
- Select Premium Only/125 (for pre-tax) and none as the Tax Tracking Type options (For After Tax).
- Now you have to choose next three times.
- In the Gross vs. Net window, Choose Net Pay for the None Tax Tracking Type, then you has to click Next.
- Default rate and limit fields should remain empty. As soon as the item is uploaded to the employee profile, you can add the rate and limit.
- Lastly you have to select Finish.
Set up Company Contribution Item
- Begin by going to Lists, And then you have to select Payroll Item List.
- From the dropdown▼ menu you have to select Payroll Item and then you have to click on New.
- Then you have to select Custom Setup and then click on Next.
- Now you have to select Company Contribution, Then click Next.
- Next after entering the item name.
- Choose (or add) the name of the Agency that will Receive Payment for the Liability, the Account Number, and the Expense Account for which you wish to keep track of the item. You have to Choose Next.
- Put None as the Tax Tracking Type. Three times, Choose Next.
- Default rate and Limit Fields Should Remain Empty. As soon as the item is uploaded to the Employee Profile, You may add the Rate and Limit.
- At last, You have to Select Finish.
Step 2: To the Employee Profile Add the Item
- Then click on Employee Center under Employees.
- Now you have to select your Employee and Payroll Info.
- Add the items related to health benefit insurance items to the section for Additions, Deductions, and Company Contributions.
- Enter the Limit and the Amount Per Period.
- Choose OK.
Step 3: Check the items inclusion on Your Employees Paychecks
These Benefits should Appear in Your Employees Paychecks every time you Pay Your Employees.
Edit or Remove an Insurance Item
The following instructions explain how to update or remove an insurance item:
QuickBooks Online Payroll
- Select Employees and then you have to go to Payroll.
- Now you have to Select your Employee.
- To Start or Edit a Deduction or Contribution, Choose Start or Edit.
- If you wish to Modify or Delete a Contribution, You have to click Edit✎ Next to it or Choose the Trash Bin.
- Lastly, You have to Select Save and then Done.
QuickBooks Desktop Payroll
Modify the Payroll Item
- Select Payroll Item List by going to Lists.
- Then you have to right-click the item and then you have to choose Edit Payroll Item.
- On each window you have to change the info as needed.
- At last, Select Finish.
Remove the Payroll Item
- Select Payroll Item List by going to Lists.
- Now you have to right-click the item and then you have to select Edit Payroll Item.
- Then you have to select Payroll Info.
- Select the amount (if any) and the item name in the Additions, Deductions, and Company Contributions column then press the Delete key on your keyboard.
Got a lot easier on setting up the health insurance contributions and deductions in QuickBooks Payroll? This article was to make sure it does!
Try out setting up the health insurance contributions and deductions in QuickBooks Payroll and let the entire process gets simplified for you.
Further to this, if you still have doubts or feel you are facing difficulties in setting up the health insurance contributions and deductions in QuickBooks Payroll, reach out to the experts who are here to help you with their proficient assistance.
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+1-800-596-0806 or chat with experts.
Frequently Asked Questions (Faqs)
Can I still add Benefit if the Employee is Entitled to Additional Pay like Housing, Bonuses or Commissions, Per Diem?
Yes. If your employees are entitled to additional pay, here’s what you must be doing for the steps that are involved in this:
Tap on Payroll and choose Select Employee
Visit Add Pay Types
Browse to Common Pay Types
Press on pay type if the list already exists
In case the list does not exist, you need to create one.
Does Group Term Life Insurance comes under Additional Pay Types?
Yes. Group Term Life Insurance comes under Additional Pay Types in QuickBooks Payroll.
Are there any Specific Types of Health Insurance Plans and Premium Available in QuickBooks Payroll?
Yes. There are two types of health insurance plans and premium available in QuickBooks Payroll:
Pre-Tax Insurance Premium
Taxable Insurance Premium
Can I apply a Credit to my Employees for Sick Leave Sanctioned Because of COVID-19?
Yes. Now, you can apply a credit to your employees for sick leave which has been sanctioned because of COVID-19. To do this, visit Families First Corona virus Response Act under Add Pay Types.