I can see you're trying to correct a tax withheld and refund your employee for it, @office40. I'd like to walk you through the process.
Make sure to back up your company file before making any changes. This way, you can restore data easily in case you encounter any errors.
After that, run a payroll checkup to zero out the Ohio wage base. Then, you can enter a negative amount for the liability adjustment to fix them. Here's how:
- Click on Employees, choose Payroll Taxes & Liabilities, then hit Adjust Payroll Liabilities.
- Go to the Date and Effective Date fields, choose the last paycheck date of the affected month or quarter.
- From the Adjustment is for, pick:
- Employee Adjustment if the item you're changing was purchased using business money. The YTD data that is reported on federal and state forms will be updated then. Next, select the employee's name.
- Company Adjustment to adjust the Payroll Liability and Center balances report's balance.
- Go to the Item Name column, choose the payroll item you want to adjust.
- Then, fill in the negative Amount of the adjustment.
- For employee adjustments, type in the amount under Income Subject to Tax column if you need to make a wage base adjustment.
- Go to Memo, type in a note about the adjustment for reference.
- Click on Accounts Affected, then hit OK.
- Choose Do not affect accounts to maintain current balances in the expense and liabilities accounts. On your payroll reports, the correction will only affect the year-to-date amounts.
- Choose Affect liability and expense accounts to fill in an adjusting transaction in the liability and expense accounts.
- Do the same thing for other employees if necessary, then hit OK.
Additionally, I suggest creating a regular check to refund your employee.
I'm adding this guide for the detailed steps: Adjust payroll liabilities in QuickBooks Desktop Payroll
Feel free to also read these helpful modules about the various tasks for income tax season and other topics:
You can always get back to us by posting a reply to this thread. We're here to assist if you have other concerns with payroll or QuickBooks in general. Keep safe!