How to Add Retroactive Pay in QuickBooks

If your company has approved a retroactive pay increase for its employees it's easy to increase the employee's salary in QuickBooks going forward. For the retroactive part of the pay raise you can add the amount as a one-time bonus using the QuickBooks EZ Setup Wizard. Once you have created the bonus item you simply add it to the employee's paycheck and set the amount.

Instructions

1. Open QuickBooks and load your company file.

2. Click "List" and select "Payroll Item List."

3. Click "Payroll Item" and choose "New."

4. Select "EZ Setup Wizard" and highlight "Compensation" in the Payroll Item Type window.

5. Click "Next" and select "Bonus, award, or one-time compensation." Select "Finish." The software will call the item "Bonus." If you already have a Bonus item on your Payroll Item List, it will call the new item "Bonus{x}" where x is a number. Look for the last bonus on the list.

6. Double-click the bonus item and change the name of the item to whatever you want, then click "Save."

7. Open the employee's paycheck and click "Start a new line" under the Earnings section.

8. Click the name of the retroactive pay item. Enter the amount in the Rate column.

Tips & Warnings

• If the software prompts you to enter hours for the retroactive pay, open the bonus item and verify it is set to "Bonus, award, or one-time compensation" and not "Hourly."

References

• Intuit: Add a Bonus Payroll Item in the Employee's Paycheck