We have our payroll through Gusto; which includes a 401k payment each payroll. This payment is expensed when we reconcile each month; but the payroll liability ledger has never been offset. How can I wipe out this liability since all of these have been paid?
Good day, @tayd.
Thank you for reaching out to us here on the Community page. I can help you with how to handle this in QuickBooks and ensure you'll be able to reconcile your account.
To start, if you haven't recorded the payment you can write a check to offset the amount of your liability account. This way, you can reconcile your account for that specific period since all the liability is already paid.
For detailed instruction, click this article: Create and record checks in QuickBooks Online. It also contains steps on how to print your check.
Once done. you can now reconcile your account so they always match your bank and credit card statements. For complete steps, check out this article: Reconcile an account in QuickBooks Online.
Just in case your QuickBooks account doesn't match with your bank statement at the end of reconciliation, you can as well open this link for the instructions on how to fix the differences: Fix issues when you're reconciling accounts in QuickBooks Online.
I'm also sharing our page about employees and payroll taxes in case you need some additional references.
Keep me posted if you have additional questions. I'll get back to assist you further. Wishing you the best in your business endeavors, @tayd.
Thanks for the message. I've been recording the expenses every 2 weeks during the payroll cycle (for example if liability is $500, recording the $500 as a 401k expense). Can I just clear it out entirely 1 time, do I need to do a massive JE?