Vacation taken exceed entitlement at time of departure

Good afternoon, @Charles284.

How are you today? I hope all is well. 

When an employee quits with a negative vacation balance in QuickBooks, you should record this as a deduction from their final paycheck by creating a "negative vacation pay" entry in the payroll system, essentially recouping the excess vacation time they took by reducing their final pay amount; make sure to document this action in the employee's file. I'm including some steps below to adjust the employee's balance. 

1. Go to Payroll, then Employees.
2. Select your employee.
3. From Pay types, hit Start or Edit.
4. Scroll down to the Time Off Policies section. Click on Edit next to the policy to make changes. Or update the Current balance.
5. Edit the balance, then tap Save.
6. When finished, select Save.

When you create the final paycheck for the employee, include the negative vacation pay, effectively reducing the employee's gross pay by the corresponding amount.

I also suggest running this by your accounting professional. Your accountant can advise the best way to handle the negative time based on your business needs. If you don't have an accountant, don't sweat it. You can find one here in our Resource Center. 

For additional information about vacation pay balances, check out Set up and track time off in payroll. 

Please don't hesitate to let me know if you have any questions or concerns. Take care!