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Correct liability payments made in Write Checks instead of Pay Liabilities in QuickBooks Desktop Payroll

SOLVEDby QuickBooksQuickBooks Desktop Payroll3Updated 7 days ago

Learn how to find and remove liability payments made in Write Checks instead of Pay Liabilities in QuickBooks Desktop Payroll.

If you have payroll liabilities that you need to pay regularly, set up a payroll liability schedule so you can pay your liabilities when they are due. If you've made liability payments through Write Checks instead of Pay Liabilities, you can correct your QuickBooks. 

Note for QuickBooks Desktop Payroll Assisted: Intuit pays your payroll tax liabilities on your behalf. You're responsible for paying your other (non-tax) payroll liabilities such as 401(k) or health insurance premiums.

You have two options to correct your QuickBooks, by deleting or recreating the payments, or by adjusting the expense accounts in Pay Liabilities.

Option 1: Delete and recreate the payment

Step 1: Backup QuickBooks Desktop

Make a backup of your company file.

Step 2: Locate your payment and print copies of the checks

  1. Find the liability payments made in Write Checks or in the bank register:
    1. Choose Vendors then select Vendor Center.
    2. Select the vendor to whom you wrote the check.
    3. Double-click the check in question in the Vendor Center where transactions are displayed (adjust the date range by clicking the drop-down menu next to Date, if necessary).
  2. Print copies of the checks to reference when creating the liability check, and note the original date, total, expense account, and check number assigned.
  3. Select Edit on the top menu then Delete to delete the check from the register.

Step 3: Enter a liability check to match each of the checks created in Write Checks

  1. Go to Employees then Payroll Center.
  2. Select Pay Liabilities then select Create Custom Payments.
  3. In the Select Date Range for Liabilities window, set the date range to include all the checks created in Write Checks and select OK.
  4. Select the appropriate payroll item by clicking the checkmark column next to the item and enter the correct amounts in the Amount to pay column.
  5. Select Review liability check to enter expenses/penalties and select Create.
  6. Update the check number and date to match the original check created in Write Checks. Alternatively, you can change the check number to the letter C (for correction), and update the check date to match the date the payment was due.
  7. If needed, click the Expenses tab to add any penalties/interest amounts.
  8. Select the Recalculate button.
  9. Select Save & Close to record the transaction.
  10. Repeat the process for each incorrect check.

Option 2:  Change expense account and amount in Pay Liabilities

Step 1: Backup QuickBooks Desktop

Make a backup of your company file.

Step 2: Locate the payment

  1. Go to Write Checks or Bill Payment and use the Previous and Next keys to locate the payment. 
  2. Note the amount paid and the expense account used.

Step 3: Update the liability payment

  1. Go to Employees then Payroll Center.
  2. Select Pay Liabilities then select the overdue liability that was paid through Write Checks.
  3. Select the View/Pay button, which brings up the liability check.
  4. Select the Expense tab.
  5. In the Account column, select the dropdown arrow and select the account used in Write checks. In the Amount field, enter a negative amount equal to the amount of the liability check.
    • Note: If the liability shown as being owed was only partially paid through Write Checks, enter the actual amount paid through Write Checks as a negative instead of the whole amount shown as being owed.
  6. Select the Recalculate button to zero the check amount.
  7. Uncheck the To Print box. If the check number field populates, remove the check number. Date the transaction to be the same date as the payment that was already entered into the QuickBooks Desktop bank register.
  8. Select Save & Close.

If you don't want to use the Payroll Liabilities module to pay your liabilities in the future, you may change the liability account in the Payroll Item. This will correct all past and future payments.

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