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Manual Entries for Payroll in US

If your company is in the US, the following are the basic set of accounts and entries required to enter employee payroll and remitting taxes to the government every pay period.

 

Please note This is a general help document. Please consult your accountant before making any entries.

 

Accounts needed for Payroll Entry

You need specific COAs to do any payroll entries. If you don't have these already, create the following Chart of Accounts before you make any entry.

 

 

 

Federal Withholding

You can calculate Federal Withholding at IRS.

 

 

 

Payroll Entry

 

1. Go to Transactions and click Others.

 

 

 

 

2. Click Manual Voucher.

 

 

 

3. Click Add New.

 

 

 

4. Enter a Reference. For Reference, you can enter your employee's name and the Pay Period.

 

5. Select the Date for which Payroll is created.

 

6. Start entering the information as mentioned below in Details.

  • Line Item 1: Payroll - Total Salary as Debit
  • Line Item 2: Payroll - Total Employer Contribution as Debit
  • Line Item 3: Social Security - as Credit
  • Line Item 4: State Unemployment Insurance - as Credit
  • Line Item 5: Federal Withholding - as Credit
  • Line Item 6: Medicare - as Credit
  • Line Item 7: State Tax - as Credit
  • Line Item 8: Other Benefits - as Credit
  • Line Item 9: Bank Account Name where the Payroll will be paid from - as Credit

 

 

7. Once you enter all the information as mentioned above, click Save as Draft or Post.

 

For instance, When creating Payroll for Dessy Rodriguez (her salary is $2433.28) for June 2016, we will enter the way as below:

 

 

 

Please note

  • Selecting Default Reference will fill in the Description fields with the text as entered in Reference.
  • Calculate Federal Withholding at IRS.

 

 

 

Employer Remittance

You can record the Employer Remittance as described below:

1. Follow Steps 1 - 5 as mentioned above in Payroll Entry.

 

2. Then enter the information as mentioned below in Details.

  • Line Item 1: Federal Withholding - as Debit
  • Line Item 2: Social Security - as Debit
  • Line Item 3: Medicare - as Debit
  • Line Item 4: State Unemployment Insurance - as Debit
  • Line Item 5: State Tax - as Debit
  • Line Item 6: Bank Account Name - as Credit

 

Please note

  • Selecting Default Reference will fill in the Description fields with the text as entered in Reference.
  • Calculate Federal Withholding at IRS.

 

3. Once you enter all the information as mentioned above, click Save as Draft or Post.

 

For instance, Employer Remittance for Dessy Rodriguez for June 2016, will be entered the following way:

 

 

 

Please note

If you have more than one employee, you will have to get the total amount for Tax Deductions and Unemployment Insurance amounts from Current Liabilities.

 

  1. Go to Reports.
  2. Under Position Reports, click Balance Sheet.
  3. Go to Current Liabilities.

 

 

Last but the most important step, remit the Total Employer Remittance amount to IRS.

 

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