How to track paying employee or contractor cash

[Dove09]

Occasionally, we have to pay an employee or a contractor with cash from the draw or undeposited funds in hand. How do I go about putting that cash P2P payment into the payroll? The only option I see in payroll is to say that we are doing a manual check. However, it holds that manual check as processing until you print it, thereby deducting it from the default account. 

Easy example:

Contractor is owed $150 

$100 direct deposit sent to them through square payroll

$50 out of draw given as cash.

The $50 from the draw is marked in the draw report as an out item.

How's do I do that as a contractor paymentbin payroll so that it attributes to their 1099 ? 

[TheRealChipA · Accepted solution]

Hi @Dove09.  On those rare occasions that I need to do this, I just go into the employees payroll payroll section of the team member entry and add a post-tax deduction for what is essentially an advance.  Then, when you run payroll, the advance will be deducted as agreed so that the employee/contractor only receives what remains after taxes and such.

Let’s say that the employee had gross pay of $250, with a $50 advance in cash out of the drawer.  If you record the advance as outlined above, when payroll is run the employee will receive:

Gross minus advance minus taxes

I hope that helps.