Year End Retirement Match for Terminated Employees
Our 401k plan requires us to include terminated employees when we do our annual 401k employer match contribution. However, this becomes an issue with recording the match in QBO because they will have zero earnings for the period of record. QBO won't let me create a paycheck unless they have some type of earning. I have spent hours on the phone with support to figure out a solution to do a net zero check for those terminated employees including the match that doesn't feel like a hack that throws off our books. Support has suggested a couple of different approaches, but all feel wrong:
- add 0.01 hours to the employee and revise their pay rate to get them $0.01 of earnings and then short pay them on the match by $0.01 (absolutely will not do this for multiple reasons)
- add another earning type and deduction type that will offset each other (this seems like the best approach, but still feels like a hack the requires journal entries to then clear up the offsetting earning and deductions)
- submit a payroll correction case that can take up to 45 days to resolve (hate to have to do this for every terminated employee, every year, and wait for the payroll correction team to just close my cases without ever fixing the issue)
Is there a better way or am I stuck with option 2 or 3?
I have had terrible experiences with the payroll correction team in the past and you have to go thru the normal support team to have any interaction with them. So you are relying on them to understand and relay your need correctly to the correction team is a long and frustrating process.