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Recording prior tax payments

Learn how to enter tax payments made for prior tax periods.

Do you need to reconcile your tax history? If you are new to our payroll products, you'll want to enter your prior payroll history, as well as any tax payments you paid outside the payroll system.

When dealing with penalties and interest paid to the tax agencies, you should not record these together with the tax due. It will result in overpayment. You should record these payments as an expense in your QuickBooks Online.

We'll show you how to record prior tax payments in Intuit and QuickBooks Online Payroll.

  1. Select Taxes & Forms then choose Enter Prior Tax History.
  2. In the Prior Tax Payments screen, select Add Payment.
  3. In the Add Payment screen, complete the following tax payment details.
    • Tax Type
    • Liability Period (select the period in which the liability accrued)
    • Payment Date
    • Check Number (optional)
    • Notes (optional)
    • Tax Items Amounts
  4. Select OK to return to the Prior Tax Payments report screen.
  5. To add a tax payment you made before using Intuit Online Payroll, choose Add Payment. (To edit a record you have already created, select the Details link and update the information as needed.)

Note: after adding tax payments you will have to export the transaction into your QuickBooks, it will reduce the liability showing due in your account.

  1. From the left menu, select Taxes, then choose Payroll Tax, then select Enter Prior Tax History.
  2. Choose Add Payment.
  3. Select tax type and liability period (the period that the taxes were accrued) then enter:
    • Payment Date
    • Check Number (optional)
    • Notes (optional)
    • Tax Item Amounts
  4. Select OK. You will then be back to the Prior Tax Payments screen.

If you need to edit a prior payment

  1. From the left menu, select Taxes, then choose Payroll Tax, then select View Tax Payments you have made.
  2. From the drop-down located at the upper right, select Edit.
  3. Make the necessary changes, then choose OK.

Once the payment is recorded it will reduce the liability showing due in your account. If you see an over payment (negative number) on your liability report or Taxes Due page, check out Resolve a tax overpayment.

If you've paid a tax and it still appears due, you might have paid the tax outside of your Payroll product. Some sample scenarios are:

  • You mailed a check to the tax agency.
  • You recorded the deposit in the banking area, under Write Checks. This will show the payment as a check in the bank register rather than as a tax payment.
  • You made the payment directly through your financial institution using online banking. This will automatically download the cleared check to the bank register.

Intuit Online Payroll

  1. Select Taxes & Forms, then choose Pay Taxes.
  2. In the Pay taxes screen, select Create Payment for the tax you want to pay.
  3. Uncheck the Pay Electronically box.
  4. For the Payment Date, select Other then enter the actual date the payment was made.
  5. Enter the check number.
  6. Select Approve.
  7. You'll be directed to the Print Payment Coupon screen. (Note: Since you've already made your payment, you can ignore it.)
  8. Verify your tax payment:
    1. Select Reports, then choose Employer Reports.
    2. From the drop-down, choose Tax Payments then select Go.


QuickBooks Online Payroll

Since the payment is already posted and accounted for you don't want to make a duplicate entry in Pay Taxes. There are two ways to remedy this situation for QuickBooks Online Payroll.

Option 1: Delete the manual check that has posted to the register. Then go through the steps to record the payment.

Option 2: Record the tax payment through Enter Prior Tax History. This will be a non-posting transaction. It will not affect the bank register, but it will clear the taxes from showing due and record the deposits. It's important to first review the breakdown of the tax payment, so that you record it accurately.

  1. Select Taxes, then choose the Payroll Taxes tab then select Pay Taxes.
  2. Select the Tax Type Name (for example, Federal Taxes 941/944). This will provide you a split on the taxes that make the total deposit.
  3. Print the page or take note of the following:
    • Tax Payment
    • Period Dates
    • Split of all the taxes and their amounts
  4. From the left menu, select Taxes & Forms, then choose Enter Prior Tax History, then select Add Payment.
  5. Using the information provided on the Payment Due Details, enter the appropriate information.
  6. Select OK.

This will remove the amount from showing up as due. The amount won't post to the register.

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