Your Payroll Taxes… and You!
Lizzy’s Payroll Tax Liability section can be a bit overwhelming, so I decided to take a moment and explain how they work. When you first go the to Tax Liability section ( Payroll > Reports > Tax Liability ), the form will be mostly blank with a Setup Tax Liabilities button, and “You have unallocated liabilities.” warning in red. As you haven’t set anything up yet, this is normal. So let’s click the Setup Tax Liabilities button, and get the ball rolling. When you open the Configure Liabilities form, you’ll see 2 sections. The upper section lists which Liability Vendors you’ve configured ( which should be none ), and the bottom section is all the Taxes that you’ve told Lizzy that you owe for.
To start with, we need to enter our liabilities at the top, along with a reference, and when we owe for it. As an example, I’ll walk you through Federal, since we all have that one. Now, in my sample DB, I have EFTPS set up as a Government Agency, since that is who I pay for my 941 Tax Deposits, and 940 Quarterly FUTA payments. Now, since these are 2 separate things, paid at separate times, I want to keep them separate from each other, even though they go to the same agency. That is what our reference is for. Leaving this blank would make things much harder later on.
So, I’ll select EFTPS for my Govt Agency, and enter something like “941 Tax Deposit” in my reference. Now with my 941 deposit its normally owed either monthly, or semiweekly ( a few days after my payroll check date ), so I’ll select which one applies to me, and then either enter 15 ( for monthly ) or 0 ( for semiweekly ). Then I’ll click save.
NOTE: Lizzy is smart enough to do the basic calculations to adjust due dates as needed. We understand that while your monthly liability is due on the 15th of the next month, there might be occassions where its due on the 16th or 17th because the 15th is a non-banking day. Lizzy will adjust this automatically, so we enter 15, because its normally due on the 15th. Same thing for Quarterly. We’d enter 31 as the last day of month, because Lizzy knows that if its due on a 30 day month, its due on the 30th, and if the last day of the month falls on a weekend, its due the 1st Monday following. However, we will allow other days entered, because we don’t know if your local tax is due on the 10th, or 20th or something like that. But again, the same rules apply – Lizzy will adjust for the weekend, non-business days…
So, next I enter my 940 FUTA entry ( selecting EFTPS as Govt Agency, “940 Futa” for a reference, Quarterly and 31 as my Due Date, then save it ). Now when I go to Assign the various tax liabilities, in my droplist, I’ll now see “941 Tax Deposit” and “940 FUTA” as options, and can select them accordingly. You would do this the same way with your state withholding and unemployment ( assuming you have those ) and any Local taxes you owe for your employees.
Once we’ve linked everything up, we can close this form, and reload our Payroll Liabilities form, by clicking Tax Liability from the menu section. now we should see a list of our “References” along with when they were last paid ( which is currently blank, as we haven’t paid them yet ), when they are next due, what period we will run for ( defaulted to the currently owed period ) and a View/Pay button. Lizzy assumes we need to run for the period just past, and lists everything accordingly, but if you needed to go back and view something from a prior period, you can change your Run For drop down. When you click on your View/Pay button, a new form will open.
This new form will show all the taxes tied to this Liability, and how much you owe on them for the period ( which would be the check amount ). You can click on the detail line, and it will then breakdown each check that makes this value, by employee.
Once everything meets with your approval, you can pay this by selecting whether this is a regular check or EFT ( Lizzy defaults to EFT ), which Checkbook you’ll be paying the check from, and shows you which Check # Lizzy will use. When your ready, simply click Generate Check/EFT, and the check will be written, and then today will show up on your Liability form as the date last paid.
And that is how Lizzy handles your Payroll Taxes!!!