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Fix a discrepancy on Payroll Liability Balances report in QuickBooks Desktop Payroll

SOLVED•by QuickBooks•8•Updated 1 week ago

The Payroll Liability Balance report includes info about payroll items assigned to a liability account, most deductions, and most company contributions. You may encounter errors or inaccurate info when you run the report. Here are some scenarios and how to fix them.

  • Scenario 1: The payroll item was posted to the wrong account in your Chart of Accounts.
  • Scenario 2: A liability check or a paycheck was voided after the liability is paid
  • Scenario 3: Write check or bill payment was used to record the payment instead of a liability check

Payroll Liabilities should be posted to a Liability Account in your Chart of Accounts.

  1. Go to Reports, then Employees and Payroll. Select Payroll Item Listing.
  2. Review the payroll item to see if it’s associated with the correct account. If it isn’t, double-click on the account name to open and edit the account. Select Next.
  3. In the Liability Account ▼dropdown, select Payroll Liabilities.
  4. Select Next until you reach Finish. 
  5. Select Finish. 
  6. In the Update transactions with new account window, select Update all existing transactions to use this new account, then OK.

A paycheck is voided

If you accidentally void a paycheck after you have paid the liabilities, negative balances will show on your Payroll Liability report. Recreate the voided paycheck to correct the amount in your Payroll Liability Balances.

A liability check is voided 

If a liability check is voided, Payroll Liability Balances will show a positive balance. Recreate the voided liability check to correct it.

A paycheck is voided

  1. Recreate the voided paycheck if it’s in the same quarter.
  2. If a voided paycheck is from a prior quarter or year, amendments will be required. Contact us for help.

A liability check is missing or voided

  1. Go to Vendors, then Vendor Center. Right-click QuickBooks Desktop Payroll Service then select Quick Report.
  2. Review the Quick Report to verify whether all liability checks are recorded.
  3. Contact us to recreate the missing or voided liability check.

Pay your liabilities with a liability check instead of a regular check. QuickBooks only recognizes that a liability is paid if a liability check is created.

  1. Go to Banking, then Use Register. 
  2. Select the bank account from the ▼dropdown, then OK.
  3. Find the regular check originally used to record the liability payment, copy down the details of the payment. Select Delete to delete the check.
  4. Select Save & Close.
  5. Record the liability check correctly through Create Custom Liability Payments or Pay Scheduled Liabilities.

Note: In some cases, you may need to make liability adjustments or a deposit refund of liabilities to fix the incorrect balance. Before you do this, speak with an accountant or bookkeeper.

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