I can provide you some insights on how to adjust payroll liabilities to your subcontractor, Steve.
You’ll need to set them up as an employee to use a liability adjustment. Let me show you how in your QuickBooks Desktop (QBDT) software.
- Go to the Employees menu.
- Select Employee Center.
- Click New Employee and enter their information in the needed areas.
- Enter the needed information and click OK.
You can also see this link for more details: Set up employee.
Once done, you can now adjust your payroll liabilities. With regards to which account to use to offset a company adjustment, I recommend checking with your accountant for their expert advice. This way, we can guarantee your accounts is well accounted for.
If you're not affiliated with one, you can always visit our ProAdvisor page and we'll help you find one from there.
You might also want to check this article for reference in filing your payroll taxes seamlessly in the future: E-file 940, 941, and 944 tax forms.
Keep me posted if you have any other concerns or questions managing your contractors and employees. I’m only a post away from you. Enjoy your weekend!
