Learn How To Adjust Payroll Liabilities In QuickBooks

Payroll liabilities are the specific amounts you need to pay your employees or part of the wages your employees owe. It includes any payroll tax kept from employees, overpaid liabilities, or incorrect taxes. When the payroll liabilities are wrong, you should know how to adjust payroll liabilities in QuickBooks. In this blog, we will discuss the right way to adjust or delete payroll liabilities.

 

However, before we dive into the process of adjusting payroll liabilities in QuickBooks Desktop, let’s look at the reasons for the same.

Reasons To Adjust Payroll Liabilities In QuickBooks

There are several situations when you need to edit or change payroll liabilities in QuickBooks. 

• When you enter payroll items with the wrong tracking type
• When there are changes in YTD wages, addition, taxes, deduction items, etc.
• When there are changes in 401(k) Health Savings Account in the company contribution section.

Getting To Know Payroll Adjustment

QuickBooks automatically calculate the deductions and contribution items in company payrolls and taxes. These make up payroll liabilities in QuickBooks and are a feature of QB Desktop payroll subscription. 

However, sometimes there are payroll discrepancies which you can find by running a payroll check-up or payroll summary report for the same month or quarter. 

When you spot any discrepancies in payroll liabilities, you need to adjust payroll liabilities in QuickBooks. 

 

Note: This article is also available as a W9 in QuickBooks Desktop

Steps To Adjust Payroll Liabilities In QuickBooks

This is the part where you carry out the adjustment in payroll liabilities. For that,

• Navigate to Employees > Payroll Taxes and Liabilities> Adjust payroll liabilities.
• Now choose the last paycheck date in the section for date and effective date. 
• To adjust YTD info, choose the employee adjustment in the part: the adjustment is for, and then select the employee’s name.
• Follow the last step even if the item is a company-paid one. 
• Now, select the item you want to adjust and enter the amount. 
• If the item is under-withheld, put a positive amount. In the opposite situation, set in a negative amount.
• For adjusting the wage base amount, fill in the amount for income subject to tax.
• Write a note in the memo for reference.
• Now choose the accounts affected. Here you can choose not to affect accounts to leave the account balance unchanged. 
• Or you can select affect liability and expense accounts, which will reflect in the liability and tax accounts.
• Now, confirm with ok and exit the affected accounts window.
• Click on the next adjustment and carry on this process for all the employees. 
• Once done, click on ok.
• Now, run the payroll summary report and check everything is fixed and correct. 

 

Congratulations, you have successfully adjusted payroll liabilities in QuickBooks. If you get stuck in any step or find an issue in your payroll or QuickBooks Desktop, you can always get in touch with our ProAdvisors.

Get Technical Assistance

Hopefully, you can adjust payroll liabilities in QuickBooks and sort out any payroll discrepancies with the help of the blog. If you encounter other issues with QuickBooks payroll and in general, you can contact our expert advisors. Dial our helpline number +1(855)-738-0359 and experience hassle-free accounting and bookkeeping now. 

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