Unraveling The Process Of Changing Unemployment Insurance In Quickbooks

To change your State Unemployment Insurance (SUI) rate in QuickBooks, you must update it manually in the payroll section. This is important to keep your tax liability accurate and to avoid overpayments. Here's a step-by-step guide: Log in to your QuickBooks account and navigate to the Settings menu, then click on Payroll Settings. Choose Edit next to the state you wish to modify. In the SUI Setup section, click on Change or Add New Rate. Enter your new rate and its effective date, then select or enter any updated surcharge or assessment rates. You can also refer to the QuickBooks help articles for more detailed, visual guides on changing your SUI rate.

Updating the State Unemployment Insurance (SUI) rate

For QuickBooks Desktop:

• Go to the "Lists" menu at the top.
• Select "Payroll Item List" from the drop-down menu.
• Double-click on " [State Abbreviation] - Unemployment Company".
• Click "Next" until you reach the "Company Tax Rates" window.
• Enter the correct rates for each quarter.
• Click "Next" and then "Finish".

Alternatively, you can:

• Navigate to the "Lists" menu on the main menu.
• Deactivate the previous sales tax rate by selecting "Edit" and then "Preferences".
• Click on "Sales Tax" and activate the "Company Preferences" tab.
• Choose "Yes" when prompted if you charge sales tax.
• Type in the tax name, rate, and a brief description (if desired).
• Enter the name of the tax agency, if applicable.
• Include a sales tax code to easily track taxable and non-taxable sales.
• Decide on your tax basis (cash or accrual) and the time frame for tax payments.
• Introduce the new tax rate and make any other necessary changes.

For QuickBooks Online:

• Log in to QuickBooks Online.
• Go to "Settings" and then select "Payroll Settings".
• Choose "Edit" next to the state you want to update.
• In the "State Unemployment Insurance (SUI) Setup" section, select "Change or Add New Rate".
• Enter your new rate and its effective date. For most states, the effective date is January 1st, but for Tennessee, Vermont, and New Jersey, it's July 1st.
• If you have any surcharge or assessment tax rates, enter those as well.
• Click "OK" to save your changes.

It's important to note that if you're unable to modify the current year's rate, you may need to contact QuickBooks support to update it for you. Additionally, if you need to change a previous quarter's rate or if you've already created paychecks with the incorrect rate, you'll need to reach out to their support team for assistance.

Changing UI contribution rates

To change UI contribution rates in QuickBooks, follow these steps:

• Log in to QuickBooks Online.
• Navigate to Settings ⚙, then click on Payroll settings.
• Choose Edit ✎ next to the state you wish to modify.
• In the State Unemployment Insurance (SUI) Setup section, click on Change or add new rate.
• Enter your new rate and its effective date. For most states, the effective date is 1/1.
• If you have a surcharge or assessment tax rate, enter it as well. Then, enter the rate and its effective date.
• Select or enter any updated surcharge or assessment rates.

If you are using QuickBooks Desktop (QBDT), the process is slightly different:

• Go to the Lists menu at the top.
• Select Payroll Item List in the drop-down.
• Double-click [state abbreviation] - Unemployment Company.
• Choose Next until you reach the Company tax rates window.
• Enter the correct rates for each quarter.
• Hit Next, then Finish.

It's important to update your UI contribution rates whenever your SUI rate changes to keep your tax liability accurate and avoid overpayments.

Editing the State Unemployment Tax Rate

For QuickBooks Desktop:

• From the Lists menu, select Payroll Item List.
• Double-click on State Abbreviation - Unemployment Company.
• Click Next until you reach the Company Tax Rates window.
• Enter the correct rates for each quarter.
• Click Next and then Finish.

For QuickBooks Online:

• Click on the Gear icon and select Payroll Settings.
• Next to the state you want to update, click on the Edit icon.
• In the State Unemployment Insurance (SUI) Setup section, click Change or Add New Rate.
• Enter your new rate and its effective date.
• If you have a surcharge or assessment tax rate, enter it along with its effective date.
• Select or enter any updated surcharge or assessment rates.

It is important to update your State Unemployment Insurance (SUI) rate correctly to maintain accurate tax liability and avoid overpayments. You can also refer to the article "Update your State Unemployment Insurance (SUI) rate" for more detailed instructions.

Troubleshooting UI contribution rate changes

For QuickBooks Desktop:

• Go to the Lists menu at the top.
• Select Payroll Item List in the drop-down.
• Double-click on the "[state abbreviation] - Unemployment Company" option.
• Click "Next" until you reach the "Company tax rates" window.
• Enter the correct rates for each quarter.
• Click "Next", then "Finish".

For QuickBooks Online:

• Click on the Gear icon.
• Select "Payroll Settings".
• Choose "Edit" next to the state you want to modify.
• In the State Unemployment Insurance (SUI) Setup section, click on Change or add new rate.
• Enter your new rate and its effective date.
• If you cannot modify the current year's rate, send a notice to QuickBooks, and they will update it for you.

Additional Tips:

• If you have received a notice from the state agency about a rate change, you can directly go to the Payroll Settings and update the rate there.
• If you haven't created paychecks using the wrong rate, you can delete or edit the rate.
• If changing the rate has caused a tax overpayment, contact your state's unemployment division to confirm the amount overpaid and how you would like to apply the credit.
• If you are using the Full Service Payroll, you won't be able to edit the SUI rate yourself. You will need to contact QuickBooks Payroll Support to enter it for you.

Resolving incorrect unemployment overpayments

To resolve incorrect unemployment overpayments in QuickBooks, you must first ensure that you are using a supported browser. If you are, you can then update your State Unemployment Insurance (SUI) rate to keep your tax liability accurate and avoid overpayments. Here's how:

• Sign in to QuickBooks Online.
• Click the Gear icon, then select Payroll settings.
• Next to the state you want to update, select Edit.
• In the State Unemployment Insurance (SUI) Setup section, select Change or add a new rate.
• Enter your new rate and its effective date.
• Select or enter any updated surcharge or assessment rates.

If you need to fix overpaid taxes in QuickBooks Payroll, you can refer to the article "Resolve a payroll tax overpayment" in QuickBooks' support resources.

If you are unable to resolve the overpayment issue by following these steps, you can reach out to QuickBooks' Customer Support team. They can check your account in a secure environment and help resolve the issue. To do this, go to the Help icon at the top right of your account and follow the prompts to connect with a live support agent.

Frequently asked questions