which account to credit for state income tax?

[CamLady]

PC 14.4
Windows 11
I normally pay quarterly state income tax from the church checking account. Pennsylvania has an online tax account system for employers. For this past quarter there was a credit in our state tax online account that was large enough to cover the tax due for the quarter. I used that credit on account to pay the tax due. I don't know which accounts to credit and debit for this transaction. The normal credit/debit is checking account 01-1110-000 - credit and State Taxable 01-2230-000 debit. What do I use for the credit portion since the payment did not come from the checking account? Thank You.

[NeilZ]

PC 14.4
Windows 11
I normally pay quarterly state income tax from the church checking account. Pennsylvania has an online tax account system for employers. For this past quarter there was a credit in our state tax online account that was large enough to cover the tax due for the quarter. I used that credit on account to pay the tax due. I don't know which accounts to credit and debit for this transaction. The normal credit/debit is checking account 01-1110-000 - credit and State Taxable 01-2230-000 debit. What do I use for the credit portion since the payment did not come from the checking account? Thank You.

I have paid income tax in PA, and if you had a credit there, you paid too much at one point. The state income tax comes out of your employee's paychecks, unlike SS and Medicare, there is no employer match.

If I remember right, PA gives a 'discount' to the employer for collecting the taxes, and paying online, so you'll always have something in the liability account. However, in this case, its obvious that you may have overpaid the taxes or paid twice. I would check to see what you have for manual checks to the state Dept of Revenue, and check that against what the state system shows for payments before you do anything else.

[CamLady]

Thank You and yes we overpaid taxes to PA at one point so that is why there was a credit in the online account. It was mistake by a past Treasurer. That issue was taken care of but I still need to know which account to credit since that one quarterly payment was not paid from the checking account.

[NeilZ]

Thank You and yes we overpaid taxes to PA at one point so that is why there was a credit in the online account. It was mistake by a past Treasurer. That issue was taken care of but I still need to know which account to credit since that one quarterly payment was not paid from the checking account.

You haven't said from where the payment was made? Was it a savings account? or what? Again, normally when paying the CREDIT account is the checking account, and the DEBIT account is the liability.

You want to put funds back into that CREDIT account by basically reversing the original transaction.

IE: If the taxes were paid from Savings it would look like this:

01-1210-000 Savings DEBIT $300.00
01-2220-000 Payroll Liab CREDIT $300.00

There's no answer we can give without knowing what asset account was used.