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January 23, 2024
Question

conversion and payroll

  • January 23, 2024
  • 1 reply
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When we did the conversion all my payroll from last year was brought over as J/E's.  I have one employee that has not cashed their check but my payroll account was credited for the amount of the check.  How do I fix this?

1 reply

January 23, 2024

Thanks for joining the forum, and I appreciate the detailed information about your concern. I'll share information that could help you get through this.

 

If an employee doesn't pick up or cash their paycheck, you are responsible for reporting it and turning it over to your state after a certain period. The state owns the abandoned wages through the escheatment process, which varies per state.

 

As an employer, you should hold the check for the employee to claim for some time (usually 1 to 5 years) before turning it over to the state. You also try to contact the employee before reporting any abandoned wages to the state.

 

Moreover, employers shouldn't void unclaimed employee paychecks, change the name on the paycheck to that of the state, or return the uncashed paychecks to your checking account. Once a paycheck is issued for wages to an employee, those funds no longer belong to the company.

 

For detailed information, refer to this article: Understand the process for unclaimed wages.

 

Additionally, I recommend consulting with an accountant or tax adviser to guide you on properly handling unclaimed wages and navigating the escheatment process following their specific state regulations. 

 

I'm leaving this article you can use in the future: Replace a lost or expired paycheck.

 

I hope this information helps! If you have any further questions, feel free to ask. I'll always be around to answer them ASAP! Stay safe!

April66Author
January 23, 2024

the journal entry is taking the money out of the bank account.  Causing my bank account to be out of balance.  What can I do to make it balance?  I am hoping she will cash check soon.