How to Zero Out Payroll Liabilities in QuickBooks Desktop?

QuickBooks users may face the issues of payroll liabilities while filing their taxes through QuickBooks. This issue is generally a result of an incorrect tax assessment. In order to rule out any mistakes in the payment of taxes, it is crucial to zero off payroll liabilities in QuickBooks.

Notably, the payroll liabilities include the employee tax liability that the company has suspended. The current blog shall give a detailed picture of the procedure to zero out payroll liabilities in QuickBooks.

Need to zero out Payroll Liabilities in QuickBooks

Liabilities need to be zeroed out in the following conditions:

In the event that the workers are no longer getting checks, liabilities may need to be zeroed out.
On the date when users want to make changes to their Health Savings Account covered by the Company obligations for its workers.
When the employee remuneration equals the net anticipated compensation, zeroing out is crucial.
Zeroing out is an unavoidable procedure since all liabilities must be paid.

Walkthrough to Zero Out Payroll Liabilities in QuickBooks

Changes by the Company:

Run QuickBooks.
Select the Employees tab.
The next step is to choose Payroll Taxes and Liabilities.

Click on change the payroll tax and liability amounts.
Choose Adjust Payroll Liabilities.

Select the appropriate modification date.
Next, choose the Company option under Adjustment.
From the item name drop-down menu, select Edit.
Type the sum of negative values.
Affected Accounts for Liabilities and Expenses can be selected by selecting the Affected Accounts option.

Be careful to choose the option to Not Affect Accounts. If you don't want accounts to be impacted, choosing the option is important.
Afterward, choose "Ok."

Changes for the Employee

You need to choose Employee under Adjustment for Fragment list.
Choose the employees whose names you want to modify from the drop-down menu.
The negative amount must be entered after choosing the payroll item from the Taxes and Liabilities section.
To preserve the modifications made to the company plan, stick to the on-screen instructions.

Steps to get Overpaid Liability as a Payroll Tax Liability Credit

Launch QuickBooks, then choose the necessary account from the Expenses tab.

Now, fill out the Amount form with the negative amount that needs to be credited.
Include the reasons behind the adjustment in the Memo section of the form.
Select the Recalculate option and swap out the check amount for the credit amount.
In the event that there is any credit left, make similar advances.
Notably, the balance report for payroll liabilities needs vital information about the payroll items assigned to a liability account, the majority of obligations associated to the business, and derivations.

Summing Up!

It is pertinent that users zero out their pending liabilities. QuickBooks allows zero out payroll liabilities in the most convenient manner. This article helped readers with the procedure to zero out Payroll liabilities in QuickBooks. For resolution of any of the other QB issues, feel free to reach us out at the QuickBooks desktop helpline i.e., 1-800-761-1787.