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Thread: How do I correct his payroll error?

  1. #1

    Default How do I correct his payroll error?

    I paid employee but forgot to take out taxes from paycheck. Employee already deposited the paycheck. Do I take out the taxes I did not deduct from next paycheck, which is after the pay deductions collected are submitted to the bank and sent to the IRS. How do I correct the tax amount or explain the doubled amount on the employee's paycheck?

    Thank You

  2. #2
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    jamesray50's Avatar

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    On the employees next check, deduct the amount for the current payroll, then on another line deduct the amount for the previous payroll. The employee probably already knows that taxes were not withheld from the previous check, but if he questions it, apologize for the mistake and go on. It has to be withheld.

    When you made your tax payment, did you make what should have been made based on a calculation from the payroll wages? Or did you pay what you actually withheld? If you want to call me, I'll be glad to help you with this.

  3. #3
    Mr. Tax Man
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    Make sure you notify him of the error before the next check, so it's not a "surprise". Then again, anyone with a paycheck that is probably a nice round number should question it. The important thing is to do this timely. After a period of time, if it's unreasaonably long, it'll become your obligation to pay on his behalf and not his.
    Small Business CPA
    "A tax loophole is something that benefits the other guy. If it benefits you, it's tax reform."

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    huggytree's Avatar

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    ive had this issue happen to me a few times over the years....he knows there was an error....he knows he got extra $....

    just explain it to him and correct it on his next check....if its a financial hardship then divide it over 2 or 4 checks...you screwed up and he may have spent the extra $$ already....so be understanding

  5. #5

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    How to Fix Payroll Errors. Cancel the payroll immediately, make updates, and reprocess it. Run an additional, manual payroll with the necessary adjustments for only the affected employees. Make adjustments on the next payroll to counteract previous mistakes and get things back in balance.

    Regards,
    Caleb

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    Nice necro caleb_cruze. Did you actually read the original post?
    Brad Miedema
    Fulcrum Saw & Tool

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