Upcoming Payroll Tax Call-out: What QuickBooks Online Users Should Know

If you’re using QuickBooks Online Payroll (or thinking about it), there are important changes coming to how payroll taxes are handled. Here’s a breakdown of the key shifts, what they mean for your business, and what you should do to stay ahead.

What’s changing

• Starting January 1, 2025, if you use QuickBooks Online’s automated tax payments and filings, the system will begin withdrawing payroll tax amounts at the time each payroll is run or when tax liabilities increase — rather than waiting until the tax payment is due.

• For year-end filings (for the 2024 tax year onward), the printing & mailing of W-2 / 1099 forms will no longer be included for free. Instead, there will be a fee (e.g., about $4 per employee/form) if you want QuickBooks to print and mail them.

• Starting November 15, 2025, all new QuickBooks Online Payroll customers will be enrolled to have the automated taxes and forms feature as a mandatory setting.

  
  

Why this matters

• Cash-flow implications: With taxes being withdrawn earlier (when each payroll runs), funds leave your account sooner than previously expected.

• Administrative action required: If you want to opt out of automated taxes, change your W-2/1099 settings, or handle mailings yourself, you’ll need to actively manage those settings ahead of the deadlines.

• Cost considerations: If you rely on QuickBooks for printing & mailing forms and don’t adjust, you’ll incur extra fees per employee/vendor.

• Compliance risk: If your settings aren’t updated, there’s a risk of missed filings or unexpected tax-payment timing shifts.

  
  

What you should do now

1. Log into your QuickBooks Payroll account and go to Payroll Settings → look for options like “Automated taxes and forms” or “Tax payment schedule”. If you prefer managing tax payments yourself, review whether you want to continue with automated taxes.

2. Review your W-2/1099 delivery settings: Do you want QuickBooks to print and mail? Or will you download and manage mailings yourself or go paperless? Set your preference before the stated deadline (typically early January 2025) to avoid extra fees.

3. Update your internal cash-flow projections: Since tax withdrawals may happen earlier in the process, adjust your budgeting accordingly so you’re not caught off guard when funds leave the account.

4. Notify your accounting or bookkeeping team: Make sure they’re aware of these changes so they can monitor liabilities and reconcile tax payments accordingly.

5. Keep an eye on communications from Intuit/QuickBooks: They may send alerts or in-product notifications about when the automated tax-withdrawal change will hit your account (some states/customers may be phased in earlier).

   
   

These updates are significant. While the features aim to streamline tax payment & filing for many users, they also demand proactive settings reviews and cash-flow adjustments. Taking action now will help you avoid surprise fees, unplanned withdrawals, and last-minute scrambling in your tax calendar. Stay ahead and make your payroll-tax workflow work for you — not against you.