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Experienced Member

Payroll error

I set up a new employee in November 2018 and I did not set it up correctly.  I did not set up to deduct FICA and Medicare taxes and the employers portion was not calculated either in the payroll liability deposits.  How can I correct this in QB before I file my 4th quarter return?

Solved
Best answer 01-28-2019

Accepted Solutions
QuickBooks Team

Re: Payroll error

Hi there, rhogarth.

 

You will need to create payroll liability adjustment to correct the taxes for the 4th Quarter. Here's how:

 

  1. Go to the Payroll Center and click Adjust Payroll Liabilities under the Other Activities section.
  2. You can use the last day of the year (12/31/2018) for both Dates and Effective Date.
  3. Select Employee in the Adjustment is for section, then look for the name of the employee.
  4. Select Social Security and Medicare taxes (both employee and company) in the Item Name column.
  5. Enter the amounts in the Amount and Wage Base columns.
  6. Click OK

You might also want to inform the employee about the adjustment so you can deduct the taxes that should have been withheld last year. I've attached screenshots below for more details.

 

Let me know if you need anything else. 

adjust payroll.PNG

 

adjust payroll 2.PNG

 

1 Comment
QuickBooks Team

Re: Payroll error

Hi there, rhogarth.

 

You will need to create payroll liability adjustment to correct the taxes for the 4th Quarter. Here's how:

 

  1. Go to the Payroll Center and click Adjust Payroll Liabilities under the Other Activities section.
  2. You can use the last day of the year (12/31/2018) for both Dates and Effective Date.
  3. Select Employee in the Adjustment is for section, then look for the name of the employee.
  4. Select Social Security and Medicare taxes (both employee and company) in the Item Name column.
  5. Enter the amounts in the Amount and Wage Base columns.
  6. Click OK

You might also want to inform the employee about the adjustment so you can deduct the taxes that should have been withheld last year. I've attached screenshots below for more details.

 

Let me know if you need anything else. 

adjust payroll.PNG

 

adjust payroll 2.PNG