Correcting a Double Tax Payment

Overview

This article explains how to correct a duplicate or overpaid tax payment by entering an offsetting External Tax Payment. Use this guidance when a tax payment has been recorded twice or the recorded amount exceeds what was actually paid, and the overpayment needs to be removed so the client's tax form reflects the correct balance.

When to Use This Process

Follow this process when:

  • A tax payment was entered or processed more than once for the same period.

  • An overpayment is appearing on the client's tax form and needs to be reversed.

  • A correction needs to be made to a Federal or State tax payment that has already been recorded.

How to Correct a Double Payment

Use these steps to correct a double payment by entering a negative External Tax Payment:

  1. Navigate to Tax Payments > Pending Payments.

  2. Select the External Tax Payment tab.

  3. Enter the required details:

    • Tax Type (Federal or State)

    • Tax Withheld

    • Period End Date

    • Date

  4. In the Amount field, enter the correction as a negative value by placing a dash (-) in front of the amount.

  5. Select Save.

  6. Review the client's tax form. The overpayment will be adjusted and should no longer appear.

Tips for Entering the Correction

  • Make sure the Period End Date matches the period of the original duplicate or overpayment.

  • Confirm the Tax Type matches the original payment (Federal or State).

  • Double-check that the dash (-) is entered in front of the amount in the Amount field so the system records the correction as a reversal.

  • After saving, refresh or reopen the client's form to confirm the overpayment no longer appears.

Key Takeaways

  • Double payments and overpayments can be corrected by entering an offsetting External Tax Payment.

  • The correction is made under Tax Payments > Pending Payments using the External Tax Payment tab.

  • The Amount must be entered as a negative value by placing a dash (-) in front of the figure.

  • Required details include Tax Type, Tax Withheld, Period End Date, Date Paid, and Amount.

  • After saving, the overpayment should no longer appear on the client's tax form.