PAYROLL LIABILITIES

Let's go over some details to uncover the underlying reasons and find a resolution for this issue, kelper62.

Under normal circumstances, the employee and employer amounts should match. Both are taxed at a standard rate of 6.2%, resulting in a combined rate of 12.4%. This applies to most businesses and forms the basis for Social Security contributions.

However, it's important to consider the possibility of undercalculations or overcalculations from previous periods. In such instances, QuickBooks Desktop will automatically adjust the current payroll to account for these differences, leading to the amounts not aligning as they usually do. To verify this, let's pull up the Payroll Detail Review report and check the taxes withheld for each paycheck. Here's how:

1. Go to the Reports menu.
2. Scroll down to the Employees & Payroll section.
3. Select Payroll Detail Review.
4. Set the reporting period to This Calendar Year-to-date.
5. Review the Social Security tax amount.

If you've thoroughly reviewed the payroll reports and are confident that there are no discrepancies or errors, we can perform a liability adjustment to correct the mismatch and YTD amounts.

I'm also adding this article to learn what to do when notice that your employee’s federal or state withholding is $0.00: Troubleshoot no income tax withheld from a paycheck.

If you have more questions or need further assistance with other calculations, please don't hesitate to get in touch with me. I'm here to help you maintain precise financial records.

Hello. My company has recently switched to a 3rd party service to process payroll. I'm struggling a bit with how to record the expenses properly without messing up our balance sheet. When we processed payroll in house with Quickbooks once paychecks were processed all taxes, deductions (employee and employer) went into the payroll liabilities account automatically from the paychecks. But, now that can't happen because the paychecks are being processed elsewhere. I'm really struggling with how to fund the payroll liabilities account. I know it can't come from our cash account because that would deduct from our cash balance which doesn't typically happen until we pay the bill as an expense and code it to one of our expense accounts. I understand how to record our expenses but what about the employee paid liabilities that are not part of the company budgeted expenses such as local taxes, employee portion of S.S., MED, state taxes, federal taxes..etc. Those would all automatically go into our payroll liability account and they won't now. I know I can just add them but I don't know how to fund those without hitting our cash "bank" account. If I do that then it will double deduct when the expense actually comes out of our bank account. Maybe i'm just way over thinking this as it's something very new to me. Any advice would be very appreciated.