Interesting response since iif files are a QB/Intuit proprietary file. 

For those having the same issues don’t upgrade your QB desktop as it’s not a fix. It’s a QB online data issue. It’s easy to see when you open the file up in Excel. I confirmed after another 5 hour 24 minute call with support that it’s a known issue. I will be switching payroll providers since QB doesn’t support their own proprietary data. ???

For those wanting a work around… import the iif file using the “import it for me. I’ll fix it later”. You will still get an error but QB creates a “new” longer iif file that you can go back and import using the same “import it for me” option and it should work.