Journal Entry Help accrued taxes

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#1
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22
Joined:
21-Jul-2015 8:54pm
Location:
nyc
Greetings,

I am at a new job, I've been strictly a tax preparer for individuals, trusts, estates, gift tax returns for the past 10 years at one company. My new job is a generalist position, at a great company with great benefits. I am working on entities for the first time in my career. Struggling a great deal with adjusting journal entries, and the accounting aspect. What would the adjusting journal entries be for accruing taxes and, do i need to gross up the payroll? Any advice? I guess the best course of action would be to crack open my old textbooks. Almost embarrassed at how rusty I am, but want to do well here. Thanks for any advice.
 

#2
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2772
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22-Apr-2014 1:34pm
Location:
North Carolina
Accruing taxes for what? Income taxes? Payroll taxes? Sales tax?
Payroll should be recorded at gross, not net, with appropriate taxes withheld.
 

#3
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22
Joined:
21-Jul-2015 8:54pm
Location:
nyc
Accrue taxes for state taxes paid adjusting journal entry
 

#4
sjrcpa  
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6475
Joined:
23-Apr-2014 5:27pm
Location:
Maryland
If they are paid there is nothing to accrue.

If they are not paid:
Dr State Tax
Cr State tax payable
Then when paid:
Dr State tax payable
Cr Cash
 

#5
JR1  
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6043
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21-Apr-2014 9:31am
Location:
Western 'burbs of Chicago
I suspect our poster is dealing with net pays that need to be grossed up in records.

Dr. Gross Salaries difference between net
Dr. PR tax expense (ER side)
Cr. Accrued Taxes

That should get you there.
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#6
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61
Joined:
19-Dec-2014 10:01pm
Location:
Massachusetts
With the new QBI rules it is more important than ever that you report payroll as gross. If you are trying to book payroll from a payroll service must have two or three entries to made each payroll period.

Entry #1 reporting the withdrawal of net pay of $30,000

Salaries & Wages DR $42,000
Federal WH CR $5,000
Fica WH CR $2,400
Medicare WH CR $600
State WH CR $2,000
Health Insurance CR $1,100
401K WH CR $900
Cash CR $30,000

Entry # Paying the payroll taxes and withholding of $15,000

Federal WH DR $5,000
Fica WH DR $2,400
Medicare WH DR $600
State WH DR $2,000
401K WH DR $900
Fica Expense DR $2,400
Medicare Expense DR $600
Futa DR $100
Suta DR $1,000
Cash CR $15,000

Entry #3 Booking Payroll Service Fee

Payroll Service Fee DR $90
Cash CR $90


If the company cuts the check to the 401k provider and not the payroll company then the check would be


401k WH DR $900
401K ER Contribution DR $27
Cash CR $927
 

#7
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61
Joined:
19-Dec-2014 10:01pm
Location:
Massachusetts
I absolutely hate how Quick books handles payroll. Half the clients bring in their books with a massive amount in accrued payroll taxes each year
 


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