How to Fix Payroll Error PS038 in QuickBooks?

In QuickBooks, you can encounter the payroll error PS038 while downloading the tax table updates or when running the payroll forms or other reports. It usually appears if your system’s date and time are inaccurate, leading to a stuck paycheck or difficulties in accessing payroll data. The error can also occur if the paycheck in payroll is stuck as “Online to send”. Besides this, there could be many other causes for the error code PS038 in QuickBooks, such as:

• Corruption in QuickBooks company file
• The issue with internet connection settings
• Incorrect Internet Security or Firewall application settings
• Missing a few files or components for payroll updates
• Fail to verify the digital signature
• Multiple instances of the QuickBooks application are opened on the same system
• Discrepancies caused by payroll items in QuickBooks
• Outdated QuickBooks version, which does not support some payroll features due to QuickBooks discontinuation
• Disabled FCS (QuickBooks File Copy Service)

How to Resolve QuickBooks Error PS038?

The QuickBooks payroll update error PS038 can occur when you try to download the payroll updates without admin rights. So, make sure you’ve selected the Run as Administrator option while launching the QuickBooks Desktop application. Sometimes, inaccurate date and time of the system can also block the updates. So, check and adjust your system’s date and time. If it does not fix the issue, then follow the below methods.

Note: Before proceeding, it is highly recommended to create a backup of your QuickBooks desktop company file.

Method 1: Check Internet Connection Settings

The downloading of payroll updates may fail due to incorrect internet connection settings, resulting in the PS038 error. You can check your internet connection settings to fix the issue. Here are the steps:

• In QuickBooks, click Internet Connection Setup.
• Click on “Use my computer’s Internet connection settings to establish a connection when this application accesses the Internet”.
• Click on the Next button.
• Click Advanced Connection Settings.
• Select Restore Advanced Settings under the Advanced tab.
• Click OK and then Done.

Method 2: Check Internet Security Software or Firewall Settings

The error can also occur due to incorrect port numbers or configuration settings in the Firewall. Check and reconfigure the Firewall settings for QuickBooks Desktop and make sure the ports like 80 and 443 are enabled.

Method 3: Check your QuickBooks Payroll Service Subscription

If the tax table file is missing or corrupted, then it might interrupt the payroll updates leading to the PS038 error. Make sure you have an active and up-to-date payroll service subscription. You can check this by using the below steps:

• First, close the QB company file.
• Now, open your QuickBooks application.
• Navigate to Employees, click My Payroll Service and then click Manage Payroll Service Key.
• The Service Keys window is displayed.
• Check the Service status. It should be active. If it is inactive, click the Edit option and check the service key number. If it is invalid, then enter the correct service key.
• Click Next.
• Unselect the Open payroll setup field and then click on the Finish option.

It will download the entire payroll update. If the error persists, then follow the next method.

Method 4: Update your QuickBooks Desktop

Sometimes, you can get the payroll update error PS038 due to an outdated QuickBooks Desktop application. Here are the steps to check and download the latest QuickBooks Desktop updates:

• Locate Help and then click Update QuickBooks Desktop.
• Click Update Now and then click Get Updates.
• Once the update is completed, click on Close and then re-launch QuickBooks.
• The QuickBooks application will prompt you to install the updates. Follow the instructions on the screen.

Now, download the latest payroll tax table using the below steps:

• Navigate to the Employees option and click Get Payroll Updates.
• Check your tax table version. For this, check the number next to the option labeled,” You are using the tax table version.”
• Click on the Latest payroll news and updates to check if it’s the right version.
• Click the Payroll Update Info option to find more details regarding the tax table version.
• Next, click Download Entire Update and then click update to get the latest tax table. 
• An information window is displayed with “download is complete” message.

Method 5: Check Issues with Payroll Data/Usage Data

The QuickBooks error PS038 can appear if there is an issue with the payroll data you are trying to process. Sometimes, analyzing the payroll data can help you identify the cause of the issue. You can do this by sending the payroll data or usage data in QuickBooks. Here are the steps:

• In QuickBooks, click on Employees and then click the Send Payroll Data option.
• The Send/Receive Payroll Data window is displayed. Click Send All.
• If the application prompts you to enter the payroll service pin, type the pin.

Method 6: Check and Fix the Stuck Paychecks

The PS038 error in QuickBooks Desktop can also occur if your paycheck in payroll is stuck as “Online to send”. You can check the stuck paychecks in the paycheck reports/paycheck list reports. Here are the steps:

• In QuickBooks, go to the left pane and click the Report menu.
• Click Check Detail Report.
• Click on the Edit option and select the Find option.
• Click on the Advanced option.
• Click on the Choose Filter tab and choose Detail Level in the Filter list.
• Click on the Summary Only option.
• Return to the Filter list, click Online Status, and then click the Online to Send option.
• Click on the Find option.
• It will display all the paychecks that are not sent.
• On the Find window, take note of the number of matches and then close the window.
• Then, run the QuickBooks built-in tool – Verify and Rebuild. It will display the stuck paychecks.
• Once the Verify data tool process is completed, then rebuild your data file.
• Go to the Utilities option and then select Rebuild Data.
• The QuickBooks information window is displayed. Click OK.
• A prompt is displayed to create a company file backup. Follow the on-screen instructions to create the backup.
• When the backup process is completed, the tool will automatically start to rebuild the file.
• Wait till the rebuilding process is complete. Then click OK.

Method 7: Switch the Stuck Paychecks

If the above method fails to fix the issue, then try toggling/switching the stuck paychecks by following these steps:

• Open the desired stuck paycheck.
• Click the Paycheck Detail option.
• In the Review Paycheck dialog box, under Earnings, enter the earnings items the same as the last earnings items in the list.
• A Net Pay Locked message is displayed. Click No.
• Ensure that there are no modifications to the tax amounts and net pay. Click OK.
• If you get a Past Transaction message, click Yes.
• Next, click on Save and then Close.
• In the Recording Transaction warning message, click Yes.
• Reopen the paycheck again.
• Click on the Paycheck Details option.
• Now delete the earnings items that you recently inserted in the Earnings field.
• Ensure that you do not modify the tax amounts and net pay. Click OK.

Method 8: Repair your Company File

You can get the QuickBooks error PS038 due to corrupted/damaged payroll data in the QuickBooks company file. You can run the QuickBooks File Doctor to repair the corrupted company file. Follow the below steps:

• First, download, install, and launch the latest version of QuickBooks Tool Hub.
• In Tool Hub, click Company File Issues.
• Select Run QuickBooks® File Doctor. 
• In the QuickBooks® File Doctor window, click on the affected company file.
• You will get a prompt to enter the QuickBooks® Admin credentials. Enter the password and click Next. 
• It may take a few minutes, depending on your company file size. 
• Once the scan is complete, check if the error is fixed or not.

If the issue persists or QuickBooks File Doctor fails to repair the company file, try Stellar Repair for QuickBooks. It is a professional third-party tool for fixing issues caused by corrupted QBW files. The software repairs the company file and shows a preview of the recovered data before saving it. Try the tool’s free trial version to review it. You can download it on any Windows system.

Closure

The payroll error PS038 in QuickBooks can occur due to numerous reasons. You can try the above methods to fix this payroll error. If the cause of the error is corrupted payroll data in the company file, you can repair the QBW file by using Stellar Repair for QuickBooks. It is a reliable tool with advanced features that can help repair even severely corrupted QBW files. This QuickBooks repair tool is compatible with all QuickBooks versions – from 2007 till 2023.

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About The Author

Monika Dadool

Monika Dadool is a Technical content writer at Stellar who writes about QuickBooks, Sage50, MySQL Database, Active Directory, e-mail recovery, Microsoft365, Pattern Recognition, and Machine learning. She loves researching, exploring new technology, and Developing engaging technical blogs that help organizations or Database Administrators fix multiple issues. When she isn’t creating content, she is busy on social media platforms, watching web series, reading books, and searching for food recipes.