Payroll Liability Balance Report and Balance Sheet Payroll Liabilities are Different

Here is how to Understand this: "Where does the balance sheet get the figure for payroll liabilities?"

Open the Payroll Liability Balances report. Set it, for instance, to Last Calendar year, Columns by Month.

Now, for instance, double-click in the Column for Oct, any one line such as Employer Medicare. Customize this detail report and include for display the Paid Through Field.

Now you need to look at these dates, to understand that the Amount Paid in Oct, if that was against Sept amounts accrued, is right here in the Oct Column = This is Not a Liability Balance report, but an Activity report that Totals. So, you would export this to Excel to remove any transaction that doesn't apply to the Timeframe you want to examine.

For the Balance Sheet account, run a Quick report on that one account, such as Payroll Liabilities. Customize it to include Payroll Item in your view, as well as Paid Through. You can filter on only one payroll item, if that helps the comparison you intend to do. On the left, confirm only Paycheck, Liability Check and Payroll Adjustments are here, and Adjustments should be minimally used. No checks, bills, JE, etc. Also, if you check on the right, you should see where a Liability Payment is made for an Amount; then scroll up and visually scan to the Date point where that same amount should show as the Balance Owed. Example:

Up to end of Dec, the FUTA item shows $350. In Jan, we have new payroll which is accruing more FUTA, but in Jan, when I make the FUTA payment for 2018, I see it is that same $350 value. That means I know 2018 ended just fine.

I hope these tools help you understand everything here is Perspective and it's always Date-related and Paid Through is the timeframe for your orientation. Because if you open a Liability Check, you see "PERIOD" which is the Paid Through info.

Hello, How to adjust, the payroll liability amount is not matching with the paid bank statement. I have booked payroll liability according to payroll reports but i found surplus paid amount in the bank transactions. how can i adjust that?

Hello there, @Sansuma.

It's nice to have you in the Community. Allow me to help share some insight about adjusting the paid liability amount to match it to your bank statement. 

You can enter the difference as historical tax payments to determine how much you overpay to the federal or state agencies. Additionally, QuickBooks will use this information to deduct the amount to your next payroll liability automatically.

Here's how: 

1. From the Help menu, choose About Intuit QuickBooks (Product).
2. Press Ctrl + Alt + Y or Ctrl + Shift + Y to open the Setup YTD Amounts window.
3. Select Next until you reach the Enter prior payments section.
4. In the Enter Prior Payments window, select Create Payment.
5.  If there is already an item with an amount selected under Taxes and Liabilities, select Next Payment. This may be a prior payment that you have already entered.
6. Enter the Payment Date and For Period Ending date accordingly (in many cases these dates will be the same).
7. In the Taxes and Liabilities field, choose the payroll tax item that you've already paid and enter the amount difference. You can add a memo to remind you what the payment is for.
8. Select test the Accounts Affected button. This displays options for how you want the payment to affect your Chart of Accounts.
9. Click Done to save your work.
10. Select Finish to close the window.

These steps should help you record the overpayment in QuickBooks Desktop. You can also refer to the following article for more details, as well as screenshots for some steps: Enter historical tax payments in Desktop payroll.

Keep me posted if you have any other questions about adjusting your payroll liabilities. I'll be here to help you out. Have a great rest of your week.