Hi there, qwerty007.
To get the correct withholding, you'll have to override the Federal Income Tax in the Run Payroll section. Then, enter the withholding amount calculated based on supplemental tax rates (22% or 37%).
You can find more details in this article under QuickBooks Online Payroll Enhanced: Create final employee paychecks.
If you're using QuickBooks Online Full Service Payroll, I'd suggest contacting our Phone Support Team. We can help you enter the severance pay.
Here are the steps on how you can reach us:
- Click the Help icon located in the upper right-hand corner.
- In the Help window, click the Contact Us button located at the bottom.
- Enter your question and click Let's talk.
- Choose either Start a chat or Call us.
For other questions or concerns, feel free to reach out to us at any time. Thanks.
