How to Fix QuickBooks Error PS038 (when paychecks get stuck)

Is QuickBooks error PS038 preventing you from running the payroll service? If yes, then follow this comprehensive guide to Know the causes and find solutions for this error in depth. 

Being one of the most essential features of QuickBooks, the payroll service is used to perform many important functions, including paying wages to employees, filing federal and state e-forms, accurately calculating and deducting taxes, managing time tracking, etc. Therefore, it’s equally important to update payroll each time for seamless payroll processing. Unfortunately, one PSXXX series error, PS038, may prevent users from running payroll or updating the tax table, causing serious distress.

In another case, this payroll error may also appear when paychecks get stuck. Thus, the error needs to be resolved to ensure that payroll processing is accurate and seamless. To help you tackle this error code, we have provided the major reasons and effective solutions in this blog below. So, let’s explore this guide and address the error on priority. 

This troubleshooting guide will help you effortlessly resolve the QuickBooks error PS038. However, if you are unwilling to undertake the resolution process or are facing time constraints, you can call QB experts for immediate guidance in resolving the error code.

What is Error PS038 in QuickBooks?

QuickBooks error code PS038 is a common PSXXX series error that occurs while running payroll or downloading the latest tax table updates. This error can also arise when the paychecks get stuck as “Online to Send.” When it comes to the root causes behind QuickBooks Error PS038, an outdated QB or data integrity issues might be mainly responsible.

All things considered, you need to tackle this error to ensure that the payroll service is running smoothly. To do this, keep reading this blog and discover the best solutions. 

Main Reasons for why QuickBooks Payroll Error PS038 occurred

To easily resolve the payroll issues in QB, you first need to understand why the payroll error occurs. Therefore, learning about the reasons behind QuickBooks error code PS038 can be very helpful in the troubleshooting process. Thus, go through the following triggers below that are responsible for this error – 

• Your QuickBooks Desktop might not be correctly updated, and the outdated version is causing issues while running payroll or downloading tax table updates.
• Your QB data file might be facing data integrity issues, which can contribute to issues while sending the payroll data.
• The payroll subscription status might be inactive or expired. 
• The QB Desktop might not be running correctly, and the program might face general issues.
• The internet connection settings might be incorrect or misconfigured, which can be another cause for payroll update issues.
• Your CPS folder in QuickBooks might be damaged or corrupted. 
• The Windows firewall or an anti-virus app might interrupt the process of updating QB payroll, leading to obstructions.

Now that we have understood why this error occurred, let’s explore some crucial prerequisites to follow before resolving this payroll issue. 

Prerequisites to Follow Before Troubleshooting QuickBooks Error PS038

Before undertaking the solutions provided below, you need to make sure that QuickBooks is updated to the latest release and the company file is backed up in the following manner –

Download QuickBooks Desktop Updates 

Your QuickBooks Desktop must be updated to the latest release to ensure that there are no compatibility issues while downloading the payroll and tax table updates. Implement the steps given below to download the latest updates for QB –

• Open QuickBooks, then go to the Help menu, select Update QuickBooks Desktop, and click Update Now.

• Further, select the Reset Update checkbox, click Get Updates, and once the updates are downloaded, reopen QuickBooks. 
• Lastly, click Install Now to install the software updates, and then restart your PC. 

Once QuickBooks is successfully updated, move to the next step and create a backup for the company file.

Also See : Resolve QuickBooks Payroll Error PS036

Create a QuickBooks Company File Backup

Backing up your company file in QuickBooks can help eliminate the risk of data loss while undertaking the troubleshooting process. You can create a backup for QuickBooks company files in the following manner –

• First, launch QuickBooks, go to the File menu, and select Switch to Single-user Mode.
• Next, go back to the File menu, select Backup Company, then click the Create Local Backup option.
• In the window, select Local Backup, hit Next, and go to the Local Backup Only section.
• Select Browse to pick a location where you want to save your backup company file, then set the number of backups you want to keep (though it is optional).
• Further, a test will be conducted to ensure your backup file is in good shape before you save. Once you’re ready, hit OK.
• Lastly, select Save it now and click Next to end the process. 

QuickBooks will create a single backup company file, and when it’s done, you will receive a confirmation message.

Now that the application has been updated and the backup has been successfully created let’s learn about the troubleshooting solutions. 

Troubleshooting Solutions to Fix QuickBooks Update Error PS038

It is crucial to resolve QuickBooks error PS038 to ensure that the updates are correctly downloaded and paychecks are being sent successfully. Thus, once you have understood the triggers behind this error, follow the effective solutions given below to address it – 

Solution 1 – Send the QB Payroll/Usage Data

Since QuickBooks error code PS038 can arise when the paychecks are stuck as “Online to Send,” you can try sending your payroll data to isolate this issue. Let’s follow the steps provided below to send the payroll/usage data in QuickBooks –

• Open QuickBooks, go to the Employees tab, then select My Payroll Service and click Send Usage Data. If you are unable to find this option, move to the next step. 
• Go to the Employees tab, then select Send Payroll Data to open the Send/Receive Payroll Data window.
• In the Send/Receive Payroll Data Window, select Send All, then enter your payroll service pin if required.

If the payroll data is successfully sent, try to update the payroll again. Unfortunately, if you still see the same error code, move to the next troubleshooting solution.

On the other hand, if the send is unsuccessful, you may need help from the support team. 

To Update QuickBooks Payroll Tax Tables – 

• Firstly, launch QuickBooks and move to the Employees tab, then click Get Payroll Updates and select Download Entire Update.
• Select Update, and once the process is complete, an informational window confirming the same will appear on the screen.

However, if the error still persists, move to the next troubleshooting solution to fix the issues. 

Also Read: Why I am getting QuickBooks Error PS034

Solution 2 – Identify the Paychecks Stuck as “Online to Send”

You need to find the stuck paychecks in QuickBooks payroll to identify the issues and resolve them. To find the paychecks stuck as “Online to Send,” go through the following steps –

• Go to the Edit tab, then select Find, and navigate to the Advanced tab.
• Further, in the Choose Filter section, open the Filter list and select Detail Level. 
• Select Summary Only, then go back to the Filter list and scroll down to select Online Status.
• Next, select Online to Send, then click Find, and you will see all the paychecks that weren’t sent to Intuit.
• Lastly, take note of the “Number of matches” on the Find window.

Once the stuck paychecks are found, move to the next solution and run the Verify and Rebuild tool to fix the data issues. 

Solution 3 – Utilize the QuickBooks Verify and Rebuild Utility

Once the paychecks stuck as “Online to Send” are identified, you can use the Verify/Rebuild tool to fix the data damage. To run this tool, you must close the Find window and implement the steps given below – 

Run the QB Verify Data Tool –

First, you need to utilize the Verify Data tool to detect any data integrity issues. You can run the tool and find the stuck paychecks waiting to be sent by following the steps given below-

• Go to Window, select Close All, then move to the File menu and select Utilities.
• Select Verify Data and initiate the verification process, if you see- 
  1. If QuickBooks detects no problems with your data, your data is clean, and you don’t need to undertake further steps. 
  2. If you get an error message, search for it on the QuickBooks Desktop support site to learn how to address it. 
  3. If the data has lost its integrity, there might be data damage in the file. In such a scenario, you need to rebuild your data to fix the issues.

Now, let’s run the Rebuild Data tool in the next section.

Run the QuickBooks Rebuild Data Utility – 

Once the data integrity issues are identified, you can run the Rebuild Data tool by going through the steps given below –

• Firstly, go to the File menu, select Utilities, and click the Rebuild Data option.

• Next, QuickBooks will ask you to create a data backup before rebuilding the data. 
• Select OK, create the backup, select where you want to save it and hit OK again. Make sure you don’t replace another backup file in the process. Enter a new name in the File name and select Save to save the backup file. 
• Once the Rebuild has completed message appears, hit OK, then go back to the File tab.
• Select Utilities, then click Verify Data again to review the data for additional damage.
  1. If the Verify Data tool finds more damage, you’ll need to fix it manually by searching for the error(s) in the qbwin.log file.
  2. If no issues are identified, you can restore a recent backup by selecting Open or Restore Company from the File menu.

“Note: Don’t replace the existing company file, as you will need to enter info into your company file again after the backup is created.”

Once you’ve done this, try downloading the QB payroll updates again and checking the status of the PS038 error code in QuickBooks Desktop. If the error keeps appearing, toggle the stuck paychecks in the next solution.

Solution 4 – Switch the Stuck Paychecks

If none of the above solutions work, you need to toggle the stuck paychecks found in Solution 2. This will help fix the issues with the paychecks that are stuck as “Online to Send,” which will resolve QuickBooks error code PS038. To toggle the paychecks, go through the detailed steps below – 

• First, open the oldest stuck paycheck, then select the Paycheck Detail button.
• Go to the Review Paycheck window and open the Earnings tab. Be sure to add the same earnings item as the last earnings item on the list.
• For instance, if the last item on the list is Hourly Rate, include another earnings item named Hourly Rate on the list.
• Next, select No when the Net Pay Locked message appears and ensure that there are no changes to the tax amounts and net pay. 
• Select OK, and if you receive a Past Transaction message, select Yes, then hit Save & Close to close the paycheck.
• Further, select Yes to the Recording Transaction warning message, then open the paycheck again. 
• Click Paycheck Details, then remove the earnings item you added in the Earnings section in Step 2.
• Next, make sure that there are no changes to the tax amounts and net pay, then select OK.
• Repeat these steps for each of the stuck paychecks found, and once all the stuck paychecks are toggled, try to download the payroll tax table updates again.

If you are still unable to update the tax tables as you receive the same error code in QuickBooks, move to the next troubleshooting solution. 

Recommended to read : How to fix QuickBooks Error PS033

Solution 5 – Review the QB Payroll Subscription Status

If you encounter QuickBooks payroll update error PS038 while updating payroll tax tables, it might be possible that your payroll subscription is invalid. For this, review the payroll subscription status and verify the service key by performing the steps below –

• Exit all your company files and restart your PC, then launch QuickBooks and go to the Employees menu. 
• Select My Payroll Service, click the Manage Service Key option, and review the Service Name and Status. If the status is correct, it will show as Active. 

• Further, click Edit and review the service key number. If the service key number is incorrect, enter the correct one.
• Select Next, uncheck the Open Payroll Setup box, then select Finish to end the process.

Now, try downloading the QB payroll updates and check the error status. If you still see the error message, move to the next solution and fix the damaged CPS folder.

Solution 6 – Rename the Damaged CPS Folder

QuickBooks Desktop error PS038 can occur when the CPS folder or the files inside the CPS folder are damaged/corrupted. To address this error, you need to rename the folder by implementing the steps given below – 

• First, press the Windows + E keys to open the Windows File Explorer, then click on This PC.
• Navigate to the Local Disk C, then run Program Files (x86) and select the Intuit folder.
• Access your QuickBooks Desktop folder that matches the current QB version, then click Components and select the Payroll folder.
• Right-click the CPS folder, then choose Rename and enter a new folder name.
• Lastly, press the Enter key to save the new folder name successfully.

Once done, reopen QuickBooks and try to update QB payroll and the tax tables to check whether the error has been resolved. If the QuickBooks error code PS038 still persists, perform the next troubleshooting solution.

Solution 7 – Repair the QB Desktop Program

Sometimes, internal issues with QuickBooks can result in errors, such as QuickBooks Payroll Error PS038. To address these errors, you can utilize the effective tools of QuickBooks Tool Hub. Therefore, let’s run the program repair process by following the detailed steps below – 

Step 1 – Install the QB Tool Hub

This centralized application contains various tools that can help resolve common QB issues easily. Thus, you need to download and install the QB Tool Hub on the PC in the following manner –

• Exit QuickBooks, download the most recent QuickBooks Tool Hub version and save the file somewhere on the computer that you can easily find.

Note: If you already have a QB Tool Hub version installed in the system, you can find out which version you have at the bottom of the Home tab.

• Further, open the QuickBooksToolHub.exe setup file you just downloaded, then follow the on-screen steps and agree to the terms and conditions to install it.
• Once the installation is complete, double-click the QB Tool Hub icon on your Windows desktop to access the utility.

Note: If you are unable to locate the icon, you can manually search for “QuickBooks Tool Hub” in the Windows search bar and successfully access Tool Hub.

Once the program is installed, move to the next step to run the Quick Fix My Program tool. 

Step 2 – Run the Quick Fix My Program Tool 

This tool works excellently to help resolve general issues in QuickBooks. Firstly, it shuts down any open background processes that QuickBooks uses. Secondly, it runs a quick repair to eliminate the issue from the root. Let’s utilize the Quick Fix My Program tool to resolve the program issues in the following manner –

• Open the QB Tool Hub, then select Quick Fix My Program from the Program Problems tab.
• Once the tool stops running, relaunch QuickBooks and open your data file to check if the issues are fixed.

If you are still getting the same error while updating payroll, move to the next section to run the QB Install Diagnostic tool.

Step 3 – Run the QB Install Diagnostic Utility

This tool resolves any general installation problems in the application with ease. To run this tool, go through the following troubleshooting steps –

• Firstly, launch QB Tool Hub, then select the Installation Issues tab and click the QuickBooks Install Diagnostic Tool.
• Now, let the tool run and resolve the installation problems, which can take up to 20 minutes.
• When the tool finishes, restart the PC and open QuickBooks Desktop, then access your data file.

Now, try downloading the latest payroll tax table updates to ensure that the error has been eliminated. However, if you are still unable to download as the QuickBooks Payroll error PS038 persists, move to the next solution.

You may also see: Why QuickBooks Multi-user Mode not Working

Solution 8 – Configure Firewall and Antivirus Settings

Firewall settings restrictions can prevent QuickBooks from accessing the internet. This may trigger the QuickBooks error message PS038 on the screen while updating payroll, as an active internet connection is needed to download the updates. To address this issue, you can configure the firewall and antivirus settings as follows:

Step 1 – Utilize the QB File Doctor Utility

This File Doctor utility resolves company file and network issues in QuickBooks. However, you can only run it if the QB Tool Hub is installed on the system. If not installed then see Step 1—Install the QB Tool Hub of Solution 7—Repair the QB Desktop Program right above to download and install the Tool Hub. Now, let’s run the File Doctor utility effortlessly by following the detailed steps below.

• Firstly, launch QB Tool Hub, go to the Company File Issues menu, then select QuickBooks File Doctor and wait for the tool to open.

Note: The QB File Doctor tool might take a minute to open; however, if it remains inaccessible, you can manually search for “QuickBooks Desktop File Doc” in the Windows search bar and access the tool.

• Next, choose your company file from the dropdown menu, and if you can’t locate it, select Browse and search to find and choose the company file you want to repair.
• Further, choose the Check your file and Network option, hit Continue, and enter the QB admin login details.
• Select Next, initiate the repair process, and once the scan is complete, rerun QuickBooks and open the company file.

Note: Depending on the file size, the scan might take up to 15 minutes, so ensure that you don’t close the tool in the middle of the process. Remember, sometimes the scan may indicate that the process was unsuccessful, even if the data and network issues are fixed. 

Once the process ends, rerun QuickBooks and check the status of the payroll error. If the error persists, perform the next troubleshooting step and manually configure the Windows firewall.

Step 2 – Configure Firewall Settings to Create QB Exceptions

If QB File Doctor isn’t able to fix the firewall issues, you can manually configure the Windows firewall and create exceptions to allow QuickBooks to bypass the restrictions with the following steps –

Create Firewall Port Exceptions for QuickBooks

The Windows firewall can be manually configured to remove blockages while updating Payroll. For this, you need to create firewall exceptions for QB ports and executable files by implementing the following steps –

Note: If you are using multiple QB Desktop versions on the same computer, firewall configuration steps need to be performed for each local version. Additionally, you need to add each year’s (versions) port numbers to the “specific ports” field in point 4 below.

• Access the Windows Start menu and type “Windows Firewall” in the search panel, then open the program.
• Navigate to Advanced Settings, right-click the Inbound Rules option, and choose New Rule.
• Further, select Port, then hit Next, and ensure that the TCP option is checkmarked.
• Find the specific ports according to your QB Desktop version from the list below and insert the port number in the Specific Local Ports field.
  1. QuickBooks Desktop 2020 and later: 8019, XXXXX.
  2. QuickBooks Desktop 2019: 8019, XXXXX.
  3. QuickBooks Desktop 2018: 8019, 56728, 55378-55382.
  4. QuickBooks Desktop 2017: 8019, 56727, 55373-55377.

Note: QBDT 2019 and later versions use dynamic ports that are specifically assigned during installation to provide the application exclusive use of a particular port.

• Follow the steps below to get the Dynamic Port Number according to your QB Desktop version –
  • Access the Windows Start menu, enter “QuickBooks Database Server Manager” in the appeared search bar, and access the QB Database Server Manager utility.
  • Next, go to the Port Monitor section, then find your QuickBooks Desktop version, and make a note of the Port Number, as you need to add it to the port exceptions list.

Note: You can modify the assigned port number (for QuickBooks Desktop 2019 and future versions) by selecting the Renew option. To renew the port number, go to the Scan Folder tab and reset the firewall permissions by selecting Scan Now.

• Once you enter the port number in the list, select Next, choose Allow the Connection, and then click Next again.
• Ensure that all the profiles are marked (if asked), then hit Next and make a new exception rule named “QBPorts(year).”
• Once the rule is created, hit Finish and repeat the steps above in the same way to create Outbound Rules for QB. Perform steps 1 to 7 above as they are, but ensure that you choose Outbound Rules instead of Inbound Rules in Step 2.

If you still see issues, go to the next section and add firewall exceptions for QuickBooks executable files.

Create Firewall Exceptions for QB Executable Files

QuickBooks executable files (.exe) are used to perform numerous tasks. Thus, firewall blockages must be removed by creating exceptions for these files. To add firewall exceptions, follow the steps below –

• Open the Windows Start menu, type “Windows Firewall” in the search bar, and access the utility.
• Further, go to the Advanced Settings menu, right-click Inbound Rules, then select New Rule and click Program.

• Hit Next, click This Program Path, then select Browse to pick an executable file from the list referred to below –

• Hit Next and click Allow the Connection, then hit Next again and ensure that all the profiles are selected (if asked).
• Click Next, then create an exception rule named “QBFirewallException(name.exe) and save it. Follow the same steps above (steps 1 to 4) to create Outbound Rules for the executable files. While creating Outbound Rules, make sure to select Outbound Rules rather than Inbound Rules in step 2.

After the rules are successfully created, reopen QuickBooks Desktop and check if the firewall obstructions are removed. Run the QB payroll update process. However, if you still face the QuickBooks payroll error PS038, modify the antivirus program settings in the next step.

Step 3 – Edit the Antivirus Program Settings

If you configured your Windows firewall but still have issues while running the QB payroll updates, review your antivirus settings to make sure QB has general permissions. The steps may vary depending on the antivirus program. Therefore, you need to perform the specific steps or follow the specific guidelines depending on the antivirus to configure the settings accordingly.

Once the antivirus program is configured to allow QuickBooks, you can rerun the payroll update process and check the status of the error. 

Conclusion

We hope this detailed guide has helped you tackle QuickBooks Error PS038 with ease. However, if you are still stuck at a particular solution or these solutions aren’t helping you fix the error, you can reach out to our team of QB professionals at 1-855-856-0042 for immediate assistance.

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Erica watson

Erica Watson is writing about accounting and bookkeeping for over 7+ years, making even the difficult technical topics easy to understand. She is skilled at creating content about popular accounting and tax softwares such as QuickBooks, Sage, Xero, Quicken, etc. Erica’s knowledge of such softwares allows her to create articles and guides that are both informative and easy to follow. Her writing builds trust with readers, thanks to her ability to explain things clearly while showing a real understanding of the industry.