How can I correct QuickBooks incorrect state unemployment tax calculations?

smpri · ‎April 12, 2024

In a few recent quarters, QuickBooks has incorrectly calculated our state unemployment taxes. I'm assuming this is a simple rounding error (my state rounds--QuickBooks doesn't). This has resulted in "Past Due" and "Overpaid" notices in the payroll tax center that I cannot remove. For the Overpaid notice, I don't want to resolve it by having it apply that amount to the next tax liability period, since it would make that period inaccurate as well. If I try to "Pay & File" or "Mark as Paid" the past due payments, I get the following error:

No taxes due this period
We calculated the amount due for this period and found that you don't owe any taxes. We adjusted your tax liability accordingly.

While I could follow the instructions provided in this answer, I'm worried that editing those payments to reflect money I did not actually pay to the state would result in inaccurate year-end taxes. How can I correct this?

JamesAndrewM · ‎April 12, 2024

Thanks for detailing your concerns about incorrect state unemployment tax calculations. I'll impart information that could help you.

The variation in net pay for salaried employees, where small differences may arise due to precise tax calculations such as Social Security and Medicare, ensures accurate year-to-date tax totals. Also, occasional penny differences on payroll reports and tax forms, noting that tax agencies typically focus on rounded dollar amounts, making these variations insignificant for compliance purposes.

QuickBooks requires the resolution of any tax discrepancies, including penny differences, before allowing form filing to ensure accuracy. When entering prior payrolls or tax payments from other services, slight discrepancies may occur due to different calculation methods. While large differences exceeding about 10 cents may indicate more significant issues requiring review, government agencies generally understand and overlook minor rounding discrepancies like a $0.01 difference in tax payments.

For detailed information, refer to this article: Why do I occasionally notice penny rounding differences?

I'm adding these articles you can use in the future:

If there's anything else that I can help you with, let me know in the comments below. I'll be happy to help.

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JamesAndrewM · ‎April 12, 2024

Thanks for detailing your concerns about incorrect state unemployment tax calculations. I'll impart information that could help you.

The variation in net pay for salaried employees, where small differences may arise due to precise tax calculations such as Social Security and Medicare, ensures accurate year-to-date tax totals. Also, occasional penny differences on payroll reports and tax forms, noting that tax agencies typically focus on rounded dollar amounts, making these variations insignificant for compliance purposes.

QuickBooks requires the resolution of any tax discrepancies, including penny differences, before allowing form filing to ensure accuracy. When entering prior payrolls or tax payments from other services, slight discrepancies may occur due to different calculation methods. While large differences exceeding about 10 cents may indicate more significant issues requiring review, government agencies generally understand and overlook minor rounding discrepancies like a $0.01 difference in tax payments.

For detailed information, refer to this article: Why do I occasionally notice penny rounding differences?

I'm adding these articles you can use in the future:

If there's anything else that I can help you with, let me know in the comments below. I'll be happy to help.

AmandaWes · ‎April 25, 2024

In my quickbooks payroll item lists have my KY Unemployment Tax Rate @ 2.625% which is correct but when I print my tax worksheet in Quickbooks it has the incorrect rate listed of 2.550%. How can I get the worksheet to update?

Ethel_A · ‎April 25, 2024

Hello there, @AmandaWes.

I'll help you fix the discrepancy of the Unemployment tax rate with your tax worksheet.

To get started, it would be helpful for you to take a look at this article which provides key information about tax calculations in QuickBooks Desktop: Understand how your payroll taxes are calculated.

If you haven't yet updated your payroll to the latest release, I suggest doing so. This can help address any payroll-related problems and ensure that you have access to the most recent tax rates and calculations within your account.

Here's how:

Go to the Employees menu.
Select Get Payroll Updates.
Fill in the Download Entire Update checkbox.
Click Update. A window appears when the download is complete.

If the issue persists, I recommend updating your tax table to get updated, accurate rates and calculations for federal and supported state taxes, payroll tax forms, and e-file and e-pay options.

Here's how to check and download the latest tax table:

Go to Employees, then select Get Payroll Updates.

To know your tax table version:
1. Check the number next to the You are using tax table version:
2. To identify if it’s the correct version, see the latest payroll news and updates.
3. To find more details on your tax table version, select Payroll Update Info.
To get the latest tax table:
1. Choose Download Entire Update.
2. Select Update. An informational window appears when the download is complete.

You may find the following articles helpful. It provides an overview in case payroll items/taxes are calculated incorrectly:

Let me know if you have questions about tax rate calculation in QuickBooks Desktop Payroll. I'm always here to help. Have a great day.

CCL BK · ‎June 07, 2024

I am having the same problem. The state drafted one penny less than QB calculated. Since QB will not allow me to manually change the amount paid to the state for SUI, how can I reconcile my bank statement. That transaction will be one penny off.

AdonL · ‎June 07, 2024

Having a balanced amount is crucial in the reconciliation process, @CCL BK. I'm here to ensure you'll have accurate financial reporting.

Since the actual amount drafted by the state is less than QuickBooks anticipated, you'll have small differences when reconciling your account. With that, I recommend contacting our Payroll Support team for assistance. They can make necessary adjustments to ensure your records match your bank statement.

Here's how to reach out to them:

Sign in to your QBO account and go to Help.
Select Contact Us.
Enter your concern, then click Let's talk.
Choose Start a chat or Get a callback to connect to the next available expert.

Otherwise, you may consider creating an adjusting entry to complete a reconciliation when there's a small difference. This step balances your accounts but should be used as your last resort, as applying them can cause accounting issues. Consult your accountant if you want to make such an entry. Refer to the articles below for more information about this option.

Additionally, QBO generates a list that shows which transactions cleared and which were left uncleared. Learn more about this feature in this resource: View, print, or export a reconciliation report in QBO.

Feel free to comment below if you need further assistance reconciling your account. We're always here to help you out. Stay safe!

CCL BK · ‎June 10, 2024

Thank you AdonL:)

RhoiceW · ‎June 10, 2024

Hi there, CCL BK.

I'm pleased to hear that my colleague assisted you in reconciling your account in QBO. Our team is committed to providing you with the best support possible, and I'm happy that we were able to assist you.

Furthermore, refer to this article to learn how to fix issues you've reconciled previously in QBO: Fix issues for accounts you've reconciled in the past in QBO.

Let us know if you still have concerns about reconciliation in QBO or any QuickBooks-related concerns. I am here to help in any way I can. Stay safe.

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How can I correct QuickBooks incorrect state unemployment tax calculations?