Question

New Qualified Overtime Compensation Tracking Not Working

Forum|Forum|6 months ago
January 5, 2026
11 replies
195 views

I am using QB Enterprise Solutions Contractor 24.0 desktop. Last week QB prompted me to use the set up wizard for qualified overtime income tracking which I did. We pay qualified overtime and I chose "yes" to track. This is the 2nd week that I have created paychecks in 2026 with qualified overtime, QB is not tracking. I have had to add it manually, a lot of trouble for how much money we pay for enhanced payroll. I spent quite a bit of time on the phone with QB help (also an hour wait for a live person). No solution yet.

QuickBooks Enterprise Suite

D

Dandie_A

QuickBooks Team

Hi there, mrsd333.

Thank you for sharing your concern about the qualified overtime tracking feature. I understand the importance of ensuring your payroll processes run smoothly, especially when working with advanced tracking setups.

Since this issue involves the new qualified overtime feature and ties to recent updates or investigations around payroll tracking changes, I recommend reaching out to the live support team again to check for any updates related to your case.

To follow up with live support, here's how:

Open QuickBooks Desktop.
Select Help at the top.
Click Contact Us.
Enter the concern "qualified overtime tracking update," then click Continue.
Choose Start a Message or Request Callback to connect with a support specialist.

When you reach out, provide the details of your previous case and mention that you've already enabled the tracking feature for qualified overtime. The live support team will be able to review your setup and share the latest guidance based on any recent updates.

Please feel free to leave us a response if you have another questions or concerns.

M

mrsd333Author

I just got off the phone from a long session with QB tech support. The end result was I was told that QB has not fixed qualified overtime tracking yet. It is a known issue and many people are calling in about it. They had no time frame for when it would be fixed. For now we must manually determine and enter qualified overtime compensation on each paycheck for each employee.

J

Jillcousins

I have it solved.

The last update added

J

Jillcousins

I am under contractor 24 desktop as well. Assuming you have to overtime fields one that is tracking as Labor cost of goods sold and one that is overhead, correct? I believe this is our delima. Quickbooks automatically set up Qualified OT Tracking as a company contribution, not has other wages as stated it should have been set up. I also spent hours on the phone with tech support with no resolution. Did you run the tool hub? Plus I believe in some way that tracking has to track back to the two overtime items that are set up in qb. Have you come to a resolution

M

mrsd333Author

We are trade subcontractors and we use timesheets for our employees. I read somewhere that we need to use the overtime (x1.5) payroll item and double time payroll item that were created by QB and not our own manually created overtime payroll items. I made sure for 2026 to use only the QB created overtime payroll items.

When I create paychecks using the timesheets, I get paychecks with the item "Qualified OT Tracking" in the "Other Payroll Items" box as well as in the "Company Summary" box. However; even when there is qualified overtime on the paycheck, there is no tracking numbers for these line items. I have to compute this number myself.

I will contact tech help again today.

Also, we are using the Right Networks cloud to access QB. In the past, fixes have been slower and I was told that Right Networks holds the program and has to make fixes themselves. Not sure of the validity of this. Right Networks is saying this is not their issue.

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Jillcousins

Hi,

The payroll update added payroll item Qualified OT Tracking as a Company Contribution.

Edit payroll item

Liability account: Payroll Liabilities (should be there)

Expense account: Payroll Expenses: Wages (however you have it set up)

Tax Tracking: Qualified Overtime Tracking (should be there from the update)

Taxes: Leave Blank

Calculate this item based on hours (obviously do not include sick and vacation as those do not create overtime)

Rate is 1.5

Limit (none)

In each employee file under payroll add Qualified OT Tracking to the additions and deductions column.

When you creating checks in that box it will the total hours 48

Below in company contribution is will calculate the amount based 8 hours of OT..If you are biweekly by 80 hours so forth and so on.

J

Jillcousins

Payroll List: Qualified OT Tracking/Company Contribution

Liability (Payroll Liability)

Expense: Payroll Expense Wages

Tax tracking type: Qualified Overtime Tracking

Taxes (none)

Calculate this item based on hours

Rate: 1.5

Limit (none)

D

ds5001ds

I am having the same issue. When I ask QB's to track the hours, it auto fills in the total hours for the week and not just the OT portion in the "qualified OT tracking" in other Payroll Items.

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MichaelaS

QuickBooks Team

Hi, ds5001ds.

I understand how this new tracking update can be confusing. Let me clarify it for you.

When the payroll wizard appears and you select "Yes", QuickBooks is designed to automatically calculate Qualified Overtime (OT) Tracking based on the overtime hours entered and the payroll item setup. However, if you select "No", the Qualified OT Tracking will not be calculated in the "Other Payroll Item" section, even if the payroll item is already set up and the option to reinstate this preference in the wizard will be available in a future.

Another one is, if you're using pay types other than the default Overtime 1.5x or 2.0 payroll item, the Qualified Overtime Tracking item will not also automatically calculate in the Other Payroll Item setup, even if you selected "Yes" in the wizard.

These factors are the reasons QuickBooks may autofill only the total hours for the week instead of also calculating the OT portion in the 'Qualified OT Tracking' field.

Because of these, you’ll need to manually calculate the correct Qualified OT Tracking amount based on the Fair Labor Standards Act (FLSA) guidelines and enter it directly into each paycheck. If you prefer, you can also input the total Qualified OT Tracking amount as a lump sum for the year on the employee's final paycheck.

You can explore these articles to learn more about the details of Qualified Overtime Tracking:

You may also read Spencer's answer here on this thread, his explanation of these issue is accurate.

Please leave us a response if you have other questions or concerns.

M

mrsd333Author

MichaelaS,

Your reply has nothing to do with the issues we are having with tracking qualified overtime pay for 2026.

First of all QB does separate the earning between Regular, Overtime, etc. in the Earnings column of the paycheck.

The problem we are having is that QB as of 2026 is supposed to be tracking the Qualified OT when applicable, this will go on the employees W2 and needs to be accurate. QB has added an item to paychecks in the "Other Payroll Items" column and also in the "Company Summary" column. This payroll item that QB has added is called "Qualified OT Tracking".

QB has said they would track this and it is not being done accurately. Multiple persons with tech help have verified that it is not working for many people. When it does put a number on the paycheck, it is wrong. QB has given a formula for what the correct number should be. IRS has guidance for what this number should be. QB is not tracking it correctly.

J

juswal

We have the same set up and same issue. That field populated correctly on one person. I thought maybe it was the payroll item set up, but others with the same payroll item are not populating either. Please advise. Should I be manually entering this when not populated or will a future fix apply it retroactively?

JoesemM

QuickBooks Team

Hello there, juswal.

To make sure the New Qualified Overtime Compensation is set up correctly, please contact our Live Support team. They can review your payroll setup in a secure remote session and walk you through the process.

Here's how:

In QuickBooks Desktop, go to the Help menu and select QuickBooks Desktop Help.
In the Help window, click the Contact Us link at the bottom.
Enter a brief description of your concern and click Continue.
Click Start a Message or Request a callback to connect with an agent.

Also, make sure QuickBooks Desktop and your payroll tax table are up to date so you have the latest rates and calculations.

Feel free to return here if you have additional questions. We'll help you promptly.

A

aball442

I was having similar issues with getting the qualified overtime tracking to work properly. We have used the payroll service for a long time and apparently whenever our payroll items were originally set up my overtime item was not using the automatically calculation at 1.5 times regular pay. I went to payroll item list and looked at the details of how each item was set up to figure this part out. I have always just entered the correct pay amount on overtime when setting up a new employee. I created a new overtime payroll item and disabled the other overtime item i had been using. It took some time to go through each employee and change all of the info from the old overtime item to the new overtime item, but after doing this Qb is now calculating the qualified overtime. On the payroll processing screen it shows up under "other items". The Rate is .5 times the regular hourly rate (it auto calculated this per each employee) and the quantity is showing the overtime hours only. However, on the employees paystub it shows just the overall amount calculated. For example if he had 10 hours at $5.00 per hour in qualified overtime it shows total $50.00. It does not show the breakdown of where that total came from on the paystub which may cause some questions from employees. But it seems to be working correctly after making these changes to my system. I just tried different things using a test employee set up. QB help line couldn't answer any of my questions when I talked to someone yesterday.

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EK99

Having the issue with this too. One of the employee's payroll automatically tracked the qualified OT correctly, and the other did not. The other one that did not get tracked showed the 50% OT portion of the rate, but the time applicable was not reflected on the tracking.

I

Irene R

QuickBooks Team

Thanks for sharing the details of your concern, Ek99. In QuickBooks, overtime is tracked based on how hours are entered into the system.

To address the overtime tracking issue for one of your employees, kindly execute the troubleshooting steps below:

For manually entered overtime, navigate to the Paycheck Detail screen and select the paycheck for the specific employee. This will prompt the system to recalculate and update the tracking.

For imported hours from timesheets, navigate to the Paycheck Detail screen and temporarily increase the overtime (OT) amount by $1. Save the change, and then revert it to the correct value. This adjustment should refresh the system’s tracking.

Feel free to reach out here if you have any additional questions!

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Money Penney

I ran into the same issues and with the help of a Certified QBs Pro, we discoved it just doesn't work. We have managed to find a work around until it is corrected.

You must assign the New Company contribution code "Qualified OT Tracking to each employee's payroll set up that is eligible for OT.

When processing payroll manually calculate the .5 that is qualified and enter the dollar amount the company summary. it is tracking the YTD.

Hope this helps.

L

LB0189

I have been on the phone with Quickbooks a few times now. Qualified Overtime Compensation is NOT working. I thought I might revisit it here as others may have gotten it to work now. I have QuickBooks Enterprise Desktop. Does anyone know how I can check how it was set up initially. Manually per paycheck is not an option for me with 30 employees-mistakes might happen that way. QuickBooks support has suggested I pay everyone the same rate or offer the same amount of overtime per paycheck. These are also not viable solutions either.

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AWSPayroll

I have spent several hours on this same problem. But, my tracking is pulling ALL hours instead of just OT hours. Suggestions?1?

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MichaelaS

QuickBooks Team

I understand your frustration with the time you’ve spent resolving this issue, and I appreciate sharing it here in this thread. Qualified OT tracking does pulls all hours because it calculates total gross wages and ensures the overtime premium portion (the extra pay above the regular hourly rate, like $10/hour for time-and-a-half) is reported accurately. This is normal behavior and ensures compliance with payroll and reporting requirements, such as for W-2s.

For example:

"If an employee worked 40 regular hours at $20/hour and 5 overtime hours (time-and-a-half at $30/hour)"

• Regular Pay = 40 × $20 = $800
• 50% of $20 = $10/hour.

• Overtime Pay = 5 × $30 = $150

• Qualified OT (Premium Portion) = 5 × $10 = $50

To ensure the calculations are accurate:

• Check your payroll setup and make sure you have selected the correct overtime pay rate (1.5x or 2.0x).
• In the Earnings section, be sure to enter regular hours and overtime hours separately. This helps keep calculations precise, ensuring that Qualified OT tracking accurately isolates the overtime premium.

Check out this article to learn more about Qualified Overtime tracking: Impact of the No Tax on Overtime provision to QuickBooks Payroll.

However, if you’d like to ensure your setup is accurate, I recommend contacting our QuickBooks Desktop Live support team. They have advanced tools, capabilities and can also use screen sharing to review your setup.

Please leave us a response if you have other questions or concerns.

D

debbiedp

I got my Jan, Feb, Mar, & Apr paycheck with overtime to work by manually entering an Hourly overtime Payroll Item. Fortunately, only 1 of our employees has the need for this. However, when I tried to run this month's payroll, it ran an update and it seems that there was a new Qualified OT Tracking update that came through. The paycheck now shows 2 Qualified OT Tracing lines under Other Payroll Items and 2 lines under the Company Summary and the YTD amounts are incorrect on both lines. I requested a call back this morning and got a very nice young lady that has nothing to do with payroll, so put me on hold to the payroll department, which we finally cancelled, as I was trying to work though some ideas from the online comments and QB Help. She said to go to help again and list payroll so it would connect directly to the payroll department. It still showed I was next in line, so I selected the chat option - which got me to a payroll person, but after about 45 minutes with no responses back, I gave up and exited that and went back to have someone in payroll call me. 2 people that didn't know anything about payroll called me.

That window still shows that I'm next in line for a Callback after several hours. Maybe everyone's payroll updated and is messed up again?

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