A payroll liability is an amount owed by the business to its employee. It can be wages, salaries, and other kinds of payments. It is treated as a liability in the business’s books of accounts because it is not yet paid to the employee. Payroll needs to be very carefully set up in QuickBooks, even a small unknowing mistake can cause a lot of hassles like incorrect liability amount, or payroll liability calculated by entering incorrect working hours or earning types.
For fixing these types of errors you can opt for deleting or removing the payroll liabilities from QuickBooks and start over. You should always take care of the below prerequisites before deleting or removing the payroll liabilities from the QuickBooks:
- You need to make sure that you have full active QuickBooks payroll subscription.
- Your QuickBooks payroll tax tables are updated as per the latest rates.
- Your QuickBooks is updated to the latest version.
- Earlier created tax liabilities will not be deleted or changed from the payroll schedule.
- If you are enabling the inactive mode for payroll tax liability, it will not clear the taxes, you will have to define the tax amount for the payroll again.
In this article we will discuss step by step process of deleting or removing your payroll tax liabilities, so let us get started.
Steps for Deleting or Removing a Scheduled Payroll Liability in QuickBooks
You can follow the below steps to delete or remove a scheduled payroll liability in QuickBooks:
Step 1. First of all, click open the QuickBooks desktop and log in with your credentials, after that click on the Employees tab.
Step 2. From the Employees tab click on the payroll centre and click on the payroll liabilities tab.
Step 3. Now go to the Other Activities drop-down list, click on ‘change payment method‘.
Step 4. Now choose ‘Benefit and Other payment‘ from the QuickBooks payroll setup window.
Step 5. Now double click on the payroll item to edit under Schedule payments.
Step 6. Now click on the ‘I don’t need a regular payment schedule for this item‘ option and click on finish and then finish again.
Steps for Creating a Scheduled Payroll Liability in QuickBooks
If you want to create a new scheduled payroll liability, you can follow the below easy steps:
Step 1. Click on the Payment activities drop-down menu under the ‘payroll centre‘ in the QuickBooks application.
Step 2. After that, type in the amount for the complete liability period and click twice on the payroll item and enter the adjustment figure. It should be negatively numbered.
Step 3. Now choose ‘Do not affect accounts‘ under the Account affected option and click on ‘Ok and edit next payroll item‘ to finish the procedure.
You should be aware that deleting a payroll liability would be a permanent action and can’t be reversed. Now when we are almost well versed with the process steps, then let us move ahead and read some frequently asked questions from the users’ end, which will give us further insight over the topic and related issues.
How can I Reconcile a Payroll Liability in QuickBooks?
You need to first print out your payroll register and match each employee’s hours to the pay register; you need to verify that pay rates for salaries and wages are correct. You need to make sure that you have taken out all the deductions from the paychecks and after that make entries in general ledger accounting to your payroll register.
What are the Steps to Adjust the Payroll withholding in QuickBooks?
First click on the Employees tab from the payroll tab on the left panel, after that click on the employee’s name and choose view paycheck list. After that click on the Net pay link and click the edit link located at the bottom. Now click the employee taxes drop-down arrow to expand and edit the federal income tax amount and finally click on OK.
Can you List Down the steps to Correct the Liability Checks in QuickBooks for Adjusting Negative Payroll Liability?
At the start, click on Banking and choose Use Register. Now select the register that you use for payroll and click on Ok. After that, right-click on payroll liability check and select Edit liability check. Now go to Payroll liabilities and update it to match your changes. After that, click on save and close and then Yes to complete the process.
How can I clear the Current Liabilities in QuickBooks?
For deleting old liabilities account, first, you need to navigate to the company menu and click on Make general journal entries. Now fill out the fields and ensure that the debit and credit sides match with each other. After that click on save and close.
How can I Remove an old Payroll Liability from QuickBooks?
First, click open the QuickBooks and go to Employees > choose Payroll centre and click on payroll liabilities. Now choose your old payroll liability to underpay taxes and other liabilities. After that select view/pay. Now enter the appropriate liability date and click on save and close.
What are the Steps to Cancel a Scheduled Payroll Run in QuickBooks?
First, go to the Employees menu and click on the payroll centre, then go to the Pay employees tab. Now choose the scheduled payroll run that you wish to delete under ‘create paychecks table’. Now from the scheduled payroll dropdown, click on Delete schedule. After that click on OK to finalize the process.
What do you mean by Scheduled and Unscheduled Payroll in QuickBooks?
A scheduled payroll run is the one that has been set up in your business’ calendar as per your payroll cycle. An unscheduled payroll run is a special run that is not actually set up in your company’s payroll cycle, for example, bonus payroll, or correction run or fix a check, etc.