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Made a mistake on a payroll check and need to correct. Haven't paid taxes yet. How to do this the most efficient way? Fairly new QB user so need step by step instructions

It will affect the net wages (increase).

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Best answer 12-10-2018

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Open the paycheck to edit. Paycheck Detail. Unlock Net Pa...

Open the paycheck to edit. Paycheck Detail. Unlock Net Pay.

1. If you are issuing a new check to replace one not issued or returned uncashed  then correct the details so that it shows the correct amount, save and reprint

2. If the paycheck is already issued and cashed>>>create a payroll item for cash advance to employee. It is an addition, tax tracking = none. Also set up a repayment item as a deduction, tax tracking = none.   In the paycheck detail adjust pay to correct amount, deduct the shortage as repayment (cart before horse) to equal check as written.

2A. To give the employee the difference you can add it to their next paycheck or you can cut a check for the advance

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Established Community Backer ***

Open the paycheck to edit. Paycheck Detail. Unlock Net Pa...

Open the paycheck to edit. Paycheck Detail. Unlock Net Pay.

1. If you are issuing a new check to replace one not issued or returned uncashed  then correct the details so that it shows the correct amount, save and reprint

2. If the paycheck is already issued and cashed>>>create a payroll item for cash advance to employee. It is an addition, tax tracking = none. Also set up a repayment item as a deduction, tax tracking = none.   In the paycheck detail adjust pay to correct amount, deduct the shortage as repayment (cart before horse) to equal check as written.

2A. To give the employee the difference you can add it to their next paycheck or you can cut a check for the advance

Established Community Backer ***

Re above 1. Make sure, after updating the existing payche...

Re above 1. Make sure, after updating the existing paycheck, to Not Let the date change, even though you are putting it on a new check Number. You need to keep this for the original Payroll pay date.

Re above 2. That would not address whatever change they feel they need to make now. You just described the "in and out" that is a self-contained offset. I believe what you intended is to Either set up a None tax tracking addition or deduction, to "fix" the net takehome back to what it was originally, after the Wages are changed and taxes recalculate.

That provides for item 2a, later, as either repayment or a payout.

When the employee already has the check, it is typically easier to deal with errors Next time. If they feel they are being cheated, then give an Advance now, and that is a regular Write Check to the employee as Other Current asset. Then do the Deduction Item as stated in item 2.

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Re: Open the paycheck to edit. Paycheck Detail. Unlock Net Pa...

If paycheck is incorrect because it has an error in state income tax withheld due to insufficient number of allowances and thus too high of state income tax deducted, how is state tax liability corrected for reporting?

Also, for 2. please make the above response more specific as to exactly how cash advance is created and how is repayment item specifically created?

Anonymous
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Re: Open the paycheck to edit. Paycheck Detail. Unlock Net Pa...

Hello, stevewall450.

 

We can use the idea presented by the Establish Community Backers above.

If this paycheck is uncashed or not yet issued, you correct the information by directly editing the paycheck. 

  1. Locate and open the employee’s paycheck.
  2. Select Unlock Net Pay at the bottom of the Review Paycheck window.
  3. Override the figures to correct the deductions
  4. Review information and click OK.
  5. Then reprint the paycheck.

However, if it’s already been issued and cashed, I’d recommend creating a reimbursement check for the over withheld and perform a liability adjustment to correct the report. To determine the correct amount deduction you can refer to the pages 48-67 in the IRS publication 15.

Here’s how to adjust payroll liability:

  1. Go Employees at the top and choose Payroll Taxes and Liabilities.
  2. Select Adjust Payroll Liability.
  3. Set the right dates and select the Employee radio button.
  4. Under the ITEM NAME column, select the tax item you’re working with.
  5. Put the negative form of the excess amount under the AMOUNT column.
  6. Click OK.

For more information about adjusting payroll liabilities, please check this article: https://community.intuit.com/articles/1762814-adjust-payroll-liabilities.

 

Let me know on the thread if you have other questions about QuickBooks.

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Re: Open the paycheck to edit. Paycheck Detail. Unlock Net Pa...

The paycheck was done as a direct deposit and a replacement check has been cut to the employee.  I just need to correct the information in Quickbooks.  What steps do I need to take. 

QuickBooks Team

Re: Open the paycheck to edit. Paycheck Detail. Unlock Net Pa...

Welcome to the Community, @cindy19.


Allow me to join the conversation. I’m here to share some information in correcting your payroll data and make sure your books are accurate.


The direct deposit offset item used for the replacement paycheck will appear as a liability in your QuickBooks. Let’s make an adjustment to remove the deduction amount from the liability balances.


Here’s how:
1.    Go to Employees on the top menu.
2.    Select Payroll Taxes and Liabilities, then Adjust Payroll Liabilities.
3.    Choose Company Adjustment. Do not select the employee, as this will make the Payroll Summary Report incorrect.
4.    In the Item Name column, select the direct deposit offset item.
5.    Enter a negative (-) amount equal to the amount of the DD Offset item on the paycheck.
6.    Click Accounts Affected and select Do Not Affect Accounts.
7.    Hit OK twice to record the liability adjustment.


For more information, please check out this article: https://community.intuit.com/articles/1762954.


Once done, the DD Offset deduction item will no longer show as a liability to be paid in your QuickBooks Desktop.


That should answer your question for today. Stay in touch with me here if there’s anything else I can do to help you succeed today. Take care and have a good one!
 

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Re: Open the paycheck to edit. Paycheck Detail. Unlock Net Pa...

Thank you for your response! Unfortunately I am using online not desktop and I’m not clear how the above would work on that platform. 

QuickBooks Team

Re: Open the paycheck to edit. Paycheck Detail. Unlock Net Pa...

Hello, @stevewall450.

 

Thanks for reaching us out here in the Community. I'm here to ensure you'll get your payroll corrected so you can get back on track.

 

Correcting the amount of the paycheck in QuickBooks Online Payroll would depend on how this was set up. If you have created it as direct deposit and it’s already processed, you'll need to void the check and recreate it as a regular paycheck with the right amount.

 

To do that:

  1. In the left navigation bar, click Workers.
  2. Select on Employees.
  3. Click Paycheck list under the Run payroll button. 
  4. Select the check you want to void or delete. 
  5. When prompted, select Yes or No. If you're not sure if the paycheck has been cashed or deposited, check with your bank or ask the employee directly.
  6. Click the I understand that this action cannot be undone. box.
  7. Click the Void Paycheck or Delete Paycheck button.
  8. If you voided the paycheck, be sure to collect the net amount from the employee.

To learn more about this process, please refer to this article: Void or delete paychecks.

 

On the other hand, if you have created it as direct deposit and taxes were already electronically paid, you will need to contact our payroll support to have this corrected.

 

To reach them: 

  1. Visit this link: QuickBooks Online Support.
  2. Select answers for the two prompts.
  3. Click Get Phone Number.

This should help you get your payroll corrected, @stevewall450.

 

Please let me know if there's anything else you need. I'm always here to lend a hand. Have a nice day!

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Re: Re above 1. Make sure, after updating the existing payche...

It has come to my attention that an employee had "Roth 401K" (after-tax)  selected for all of their paychecks from January to May, however this employee has a "Roth 401K" (pre-tax) account. So all of their paychecks are wrong, and I need to correct it so the taxes being deducted are correct. Basically he had too much tax withheld from his paycheck. So I have been following these instructions to correct all of his old paychecks and it was going very well, however I hit a snag when I got to March. Apparently the tax table was updated then, and it is telling me to be careful in updating any paychecks before this date because it will use the new tax table information, not the old one.... What do I do for these paychecks in Jan, Feb and March? 

 

Also, do I need to adjust the payroll liabilities account for this employee? And do I need to file a 941-X? If so, is this something I can do through the Payroll Center?

 

Thank you kindly.

QuickBooks Team

Re: Re above 1. Make sure, after updating the existing payche...

Thanks for joining this thread and providing on-point details about your concern, @topknotchbookkeeping

 

Let's first change the incorrect payroll item from Roth 401K after-tax into pre-tax tracking type. Here's how: 

 

  1. Go to the Lists menu at the top. 
  2. Select Payroll Item List.
  3. Right-click the item and choose Edit.
  4. Select Next twice. Choose the correct tax tracking type, then select Next.
  5. Follow the on-screen instructions after clicking Next.
  6. Click Finish.

 

If your employee doesn't have the same rates, you can enter the rates on the employee profile. Here's how: 

 

  1. Go to the Employees menu at the top.
  2. Select Employee Center.
  3. Double-click the employee's name.
  4. Go to the Payroll Info tab.
  5. In the Addition, Deduction and other Company Contributions, enter the correct rate and limit.
  6. Click OK.

 

Then, you can verify the wage base by running the Payroll Summary report. 

 

After that, you'll need to adjust the payroll liabilities for your employee. This will correct the employee's year-to-date (YTD) information to ensure your forms are correct. You can also perform the steps provided by my peers above in making payroll liability adjustment. 

 

You'll need to file a Form 941-X since there are corrections made on your employee's paychecks. This can be done through the Payroll Center and click the File Forms tab. For detailed steps on how to prepare the form, you can check out this helpful article: Correct or Amend Forms 941

 

Since the tax withheld from his paycheck was too large, you must refund the amount to the employee. I'd suggest writing a check for the amount owed to the employee.

 

For more details, here are great articles you can refer to:

 

 

This will help you get back on track, @topknotchbookkeeping

 

I'm here anytime you have other payroll concerns. Have a great day. 

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Re: Open the paycheck to edit. Paycheck Detail. Unlock Net Pa...

I submitted payroll to Intuit and immediately realized that the one employee who doesn't have direct deposit had an incorrect rate. I found your instructions here, edited the check and then printed it. 

 

Now, under Pay Employees, it shows I have a payroll pending and says Resume Scheduled Payroll. When I click on Resume Scheduled Payroll the same employee shows up with the hours and rate I just paid him for but for the next pay cycle (next week).

 

The check I printed has the correct pay date and pay period listed. The payroll summary and liability reports are correct as well.  So why does this show that I have a pending payroll for this EE? How do I correct it?

QuickBooks Team

Re: Open the paycheck to edit. Paycheck Detail. Unlock Net Pa...

Hello there, @judith4.

 

I appreciate you following the steps provided by my colleagues above on how to edit a paycheck. I'd be glad to help you correct the pending payroll showing in your Pay Employees window by editing the pay period.

 

I want to let you know that every time you'll edit a submitted paycheck, it'll show as pending payroll. 

 

To resolve it, you can consider ignoring the pending payroll first. Then once you'll run your payroll for the next pay cycle, you'll need to edit the paycheck to the correct pay period before submitting it. This way, your employee won't have a pending paycheck.

 

You might want to read this article to learn how to manage payroll schedules: Set up and Manage Payroll Schedules.

 

Keep me posted if you have any follow up questions about payroll. I'll be around if you need any help.

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Re: Open the paycheck to edit. Paycheck Detail. Unlock Net Pa...

because we use the payroll service, it will not allow me to change anything about the check.

QuickBooks Team

Re: Open the paycheck to edit. Paycheck Detail. Unlock Net Pa...

Hi, @KShipley.

 

I appreciate you for posting your concern here in the QuickBooks Community. Helping out with the employee's paycheck is my priority.

 

Once you have an active payroll service, you have an option to edit your employee's paychecks. You can also delete it and re-create a new one if it's a regular paycheck. 

 

However, if this is a direct deposit paycheck that has been transmitted to Payroll service and the status is already offloaded, you can no longer edit it. Instead, you can add the corrections on the next employee's paycheck. 

 

For additional reference, you can check this article: Modify or void pay and liability checks.

 

Fill me in if you have additional questions about the employee's paycheck. I'm always here to help you out. Have a good one. 

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Re: Open the paycheck

You sound like an absolute Quickbooks genius. Unfortunately, I still can’t figure out how to fix my problem.  I issued paychecks (7) with no taxes removed.  My employees cashed the checks before the error was caught.  Only one was direct deposit (yes, I’d already sent it.) How do I correct the other checks? Thank you for your help!

QuickBooks Team

Re: Open the paycheck

Hello there, @Rjam02.

 

There are two ways to fix the paycheck that has no withholding. Let me guide how to do it.

 

First, incorrect payroll calculation is usually caused by an outdated tax table version. Always make sure to run a payroll tax table update before processing payroll.

 

Meanwhile, when taxes are not withheld in the previous paychecks, QuickBooks will automatically correct the calculation when you run the next payroll. However, this is applicable to social security and medicare only. 

 

You can delete the incorrect paycheck from QuickBooks and create an unscheduled one with a correct tax withholding. Once done, you'll have to inform your employees to return to you the overpaid amount.

 

You can read through this article for more detailed instructions: Void a paycheck.

 

The other way is to have an agreement with your employees that you'll deduct the overpayment to their next paycheck. Just make sure to create a Non-Taxable payroll deduction item to indicate the overpayment. 

 

For more insights, you can refer to this article: Reduce paycheck wages for an employee who has been overpaid.

 

Keep me posted if you have other questions. I'm just a few posts away.

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Re: Open the paycheck

Thank you so much for your help!

 

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Re: Open the paycheck

Thank you so much for your help !

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