QuickBooks Payroll 401K

QuickBooks Desktop allows you to use the payroll services within the software. Payroll and tax calculation can be a very hectic and long process and you can face various errors and issues as well. But QuickBooks payroll makes managing your employees and tax calculation very easy and accurate. You can file and process various forms such as the 401(k). In this article, we will be providing you detailed information about the QuickBooks Payroll 401K. You can also contact us at QuickBooks Payroll Support Phone Number +1800-621-5491 to get additional information about QuickBooks Payroll 401k or any kind of support.

QuickBooks Payroll 401K

What Is a 401(k) Plan?

A 401(k) is a retirement plan provided to employees by the employer. This plan is for all eligible employees who keeps salary deferral or any kind of deduction in the salary form. It is created for a pre, or post-tax basis. If you are an employer, you can create matching or non-elective contributions to the plan. It is specially introduced in QuickBooks for eligible employees and those who avail profit-sharing in the form of an additional plan. The accumulated earning depends on a tax-deferred way.

How Many Types Of 401(k) Plan Are There?

In QuickBooks, the 401(k) comes with two different plans:


In the standardized 401(k) plan, entire compensation is considered wages are subjected to the consideration while calculating a deferral in the salary.

Non- Standardized

In the non-standardized 401(k) plan, there are various important features. In this plan, the employer and employee both has option to not to contribute various kinds of pay for retirement deferral.

How To Set Up 401(k) Contribution In QuickBooks?

You can set up the 401(K) plans by following two different methods and they are as follow:

Method 1: EZ Setup

  • From the main menu, go to List > Payroll Item List.
  • Choose Payroll Item and click on New.
  • From the new window, select EZ Setup and then Next.
  • Now, follow the onscreen prompts and then edit the payroll item while it was created to validate.
  • Provide the required vendor information in the window.

Remember: You can use the EZ Setup as well that will add the company contributions automatically in the payroll item for retirement plans. Also, make sure that you don’t make changes in the preset tax settings.

Method 2: Custom Setup

  • From the List menu, select Payroll Item List.
  • Choose Payroll Item and then click on New.
  • Select Custom Setup and then Next
  • Choose Deduction and then Next.
  • Under the Enter name for deduction box provide an item name and then click on Next.
  • Open Liability account dropdown to select the account which will be used to track deduction and then click on Next.
  • From the Tax Tracking Window, select tax tracking type classification as per the plan and then click on Next.
  • In the Payroll Item column, put a checkmark on any payroll item. This will be calculated once the deduction is processed and then click on Next.
  • In the Calculate Based on Quantity, click on Neither and click then click on Next.
  • If the Gross vs. net window appears: if the deducted amount is the percentage of gross earnings, choose gross. If it is a fixed dollar amount, click on Net. The tax calculation of an amount depends upon the tax tracking type you have selected and not by the gross vs net calculation. Click on Next.
  • If the amount applies to most of the employees has similar deduction rate, move it to the top of Limit Type. If you find any annual deduction limit, it should be visible in the lower field only when the limit is similar for all or majority of your employees.
  • Click on Finish to complete the process.

How To set Up A Retirement Plan Company Contribution Item Using Custom Setup?

To set up company contribution of retirement plan through custom setup, follow the steps provided in this section:

  • From the main menu, go to List > Payroll Item List.
  • Choose Payroll Item and click on New.
  • Select Custom Setup and then click on Next.
  • Choose Company Contribution and then click on Next.
  • Provide a name to the contribution and then select Next. (Do not use a name which is already used for employee deduction.)
  • From the Liability Account, select the previous selected liability account.
  • From the Expense Account drop-down list, choose an expense account and then click on Next.
  • From the Tax Tracking Type screen, choose a tax tracking type classification as per your plan.
  • If the amount applies to most of the employees has similar deduction rate, move it to the top of Limit Type.
  • Click on Finish option to complete the payroll item setup in QuickBooks.
  • If the contribution amount is different for most of the employees, modify the contribution amount for those particular employees.

How To Add The New Payroll Items To The Employee Record?

You can add a new payroll item to the employee record by following the below-mentioned steps:

  • From the Employees menu, select Employee Center.
  • Open the Edit Employee window by double-clicking on the employee for which you want to add new payroll item.
  • Navigate to the Payroll Info
  • Under Additions, Deductions and Company Contributions section:
    • Click on the Item Name drop-down list.
    • Select new payroll item(s) for the retirement plan(s).
  • Put a checkmark on the Employee is covered by a qualified pension plan checkbox, if the employee participates in a 401(k), 403(b), 408(k)(6) SEP, or SIMPLE IRA plan.
  • Click on OK.
  • Perform same steps for all eligible employees.

Technical Support For QuickBooks Desktop

The provided steps in this article should be helpful for you in setting up the QuickBooks Payroll 401K plan in QuickBooks easily. It is an important feature provided by Intuit as it allows you to set up the retirement plans for your employees with few simple steps. However, if you are facing any kind of issue while setting up the 401k plan, you can connect with our technical support department of Intuit by dialing our toll-free QuickBooks Support Phone Number +1800-621-5491 to get instant QuickBooks support.