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November 12, 2024
Question

How to record a 401k employer Profit Sharing contribution in December that will be funded in March

  • November 12, 2024
  • 1 reply
  • 3 views

I have until March for my company to fund a 401k employer Profit Sharing contribution. I want to record the liability 12/31 but for cash-flow reasons, fund it after I file taxes.  How do I record this transaction?

1 reply

BigRedConsulting
Level 15
November 15, 2024

Record the expense in the liability account register you're using to track the liability, as an increase in the balance.

Then later when you send the cash, use the same liability account as the 'expense' account on the check.