User Support Forum

So I have an interesting situation that I'm hoping someone can give me advice on.

I took over bookkeeping in August. I noticed that we had a refund check from the IRS that we've had since March and I also got letter from IRS saying they owed us more money. When I was entering everyones W2's online for 2012 I got a "warning" saying we withheld too much SS. When i went to update the employee SS contribution percentage it was already at 6.2% so we have been taking too much for the past year (at least). I've had one employee who already tried to do here taxes and got a warning saying that her withholder held to me ss. WHAT DO I DO? should the church just pay the employees and then any refund checks we get from the IRS put in the general fund? I need to make the correction fast and fix everyones W2's.

Thanks for any help you can provide!

Before I suggest anything that would REALLY mess you up, let me ask you this - Is Dec 2012 still open?

Yes december 2012 is still open.

I believe this will work, but others may want to chime in.

If you turn off all the pay items except Social Security, and enter the corrective negative amount for Social Security in that pay item for one run, and do a payroll run, that should subtract the correct amount from the total Social Security for the year.

That will straighten out the amount on the W2s. You will then have to cut a check from Accounts Payable to the employees to reimburse them.

You could create a liability account for the refund that you received, and use that same liability account when you cut the check to the employee.

Receive $100 from government:
DB 01-1110-000 checking
CR 01-2111-000 refund SSI

Cut check to employees
CR 01-1110-000 checking
DB 01-2111-000 refund SSI

I occasionally do similar things, but I have to admit, I have not tried this.

Sounds like a good plan, but I will advise one thing.

DO A BACKUP FIRST .. this way you can revert to the current data if the process that John described didn't work right.