How to Correct the QuickBooks After-the-Fact Payroll

Using QuickBooks After the Fact Payroll to correct mistakes can save you money.

You have just discovered that your payroll company is going broke, or the service you are getting is sub-par at best and you need to transfer all the reports they have to your QuickBooks files, just to make sure your employees get their W-2's and that you pay your end of the year payroll taxes accurately.

QuickBooks If you switch from a third party service to QuickBooks payroll, you will have to use the After the Fact Payroll to enter in all current payroll information to generate accurate payroll tax returns. Sometimes entries need to be corrected too.

Instructions

1. Open the Payroll Center. Click on the icon that is labeled "Employee Center". This is where the Payroll center is located. On the left side of the window there will be the "Payroll" tab, click on that tab and the payroll window will open.

2. Run After the Fact Payroll. This is located in the upper third portion of the window. Click on the button labeled "Switch to After the Fact Payroll" this will prompt a tab labeled, "Run After the Fact Payroll" to pop up. Click on that and the after the fact payroll spreadsheet style window pops up.

3. Purchase the QuickBooks payroll subscription. If the purpose for running after the fact payroll is to print checks or payroll tax forms you will need to have a subscription for the QuickBooks Payroll. The subscription includes the use of tax tables which will help in the correction of any tax calculation areas. If the purpose is simply the recording of information to maintain complete and accurate financial records.

4. Adjust the out of balance paychecks. When a payroll company or bookkeeper makes a mistake in the calculation of payroll taxes, if the mistake is not caught before the quarterly tax return is filed, you must make the adjustment in the after the fact payroll before year end. The first of two methods is the method which applies an out of balance difference on a paycheck (i.e., where the gross wages are plus or minus the correct number) to the Federal Withholdings. To do this, simply check the first of the two calculation method boxes and QuickBooks will automatically make those adjustments or corrections for you.

   The Social Security and Medicare deductions from Gross Pay equal 15.3 percent. These amounts must be recorded with a good degree of accuracy because these are the amounts that are reported to the state and federal governments on quarterly payroll taxes. Applying the differences to Federal Withholdings minimizes the effect of this error because Withholdings can be altered or changed at anytime throughout the year by using a Form W-4.

5. Leave Calculated Net Pay blank. If the correction to the after the fact payroll reflects a minimal difference in net pay or calculated taxes, you can accept the calculated net pay by leaving the net pay column blank. If there is a difference it's likely that the individual calculated the taxes in a different way than QuickBooks does.

6. Correct other entries. The After the Fact Payroll screen has 15 columns in a spread sheet format, only 5 of these columns can be changed or corrected. These changeable columns are the date, paycheck number, employee name, gross wages and net wages. The other ten columns cannot be altered and these columns are filled in grey background to indicate this.

References

• Intuit Small Business: Payroll Support: What is the After the Fact Payroll Process?
• Intuit Proline: Entering Gross Wages in After the Fact Payroll