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The detailed process to Adjust Payroll liabilities in QuickBooks
by Emily Taylor QuickBooks ServicesSmall and medium-sized business owners use QuickBooks to manage their accounts, pay their employees, and file taxes. Users can easily pay their employees and file payroll-related taxes through QuickBooks Payroll. The Internal Revenue Services (IRS) is very strict with tax collection and impose penalties in case of faulty calculations. Due to this fear, 3 in every ten business owners overpay their payroll tax liabilities. If you are one of those business owners, you would be glad to know that you can adjust payroll liabilities in QuickBooks. Through this, you can get back the amount that you paid extra. In this article, we will discuss the reasons that can bring about inconsistencies in Payroll liabilities and the detailed method to correct them.
Reasons that can cause inconsistencies in Payroll liability
When you use the QuickBooks payroll services, the tax calculations are done automatically by the application itself. It is then entered into the Payroll liability account. There are various instances when it can produce inconsistencies in payroll liability. These have been listed out for you:
- The assigned date of the due liability is wrong.
- If a human error such as a wrong input is committed in the process, inconsistencies may appear.
- Issues in tracking the account can also result in the error.
- A paycheck that has been canceled or deleted will produce a liability in the report.
- Corruption in the Company File is also a reason behind payroll inconsistencies.
- Using an outdated version of the application can also create issues.
How to clear payroll liabilities in QuickBooks?
If you are wondering How to clear payroll liabilities in QuickBooks, here are the detailed steps for that:
- Generate the Payroll summary report in your QuickBooks Payroll.
- Save the amount that has to be adjusted on the Payroll items.
- Go to the ‘Employees’ section and select the ‘Payroll Taxes and Liabilities’ option.
- Press the option saying ‘Adjust payroll liabilities in QuickBooks’.
- Adjust the date as per the adjustment item.
- Payroll will automatically fetch information from tax forms and check the amount.
- Select either the ‘Employee’ or ‘Company’ adjustment option.
- Choose the affected account and then click on one of the options, the ‘Affect liability and expense accounts’ option or the ‘Do not affect accounts’ option.
- You should recheck the full report after performing these steps and make sure that the total is correct.
How to get Payroll liability credit?
Perform the following steps to get payroll liability credit after making adjustments to payroll:
- Go to the ‘Expenses’ menu and select the account where you want the credit.
- Enter the negative amount equal to the adjustment in the ‘Amount’ section.
- Input the explanation as ‘Memo.’
- Click on the ‘Recalculate’ option to adjust the check amount with the credit amount.
Through this process, you should be able to adjust payroll liabilities in QuickBooks easily. We discussed the various aspects related to payroll liability adjustment in QuickBooks and also discussed its detailed steps. If you come across any issues while performing these steps or if you require an expert’s assistance, contact us at our (855)-526-5749.
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About Emily Taylor 
QuickBooks Services
3 connections, 0 recommendations, 18 honor points.Joined APSense since, October 21st, 2020, From Texas, United States.
Created on Jan 26th 2021 13:23. Viewed 413 times.
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