QuickBooks Desktop throws error PS038 when you try to download payroll updates, and payroll won't run until it's cleared. The cause is almost always paychecks stuck in "Online to Send" status that never finished transmitting to Intuit.

Before You Start

Two things first. Update QuickBooks Desktop to the latest release for your version, and make a backup of the company file. File, Back Up Company, Create Local Backup. You'll be editing paychecks, so don't skip the backup.

One more check: if you're on QuickBooks Desktop 2023 or older, payroll services were discontinued on May 31, 2026. PS038 on a discontinued version isn't fixable, you need to upgrade first. See our post below.

Quick Fix: Send the Stuck Data

Go to Employees, My Payroll Service, Send Usage Data. If you don't see that option, use Employees, Send Payroll Data instead. If the send completes, try the payroll update again. For many people that's the whole fix.

If That Didn't Work: Toggle the Stuck Paychecks

When the send fails, you have to find the stuck checks and force their status to reset.

Press Ctrl+F and search for paychecks with an Online to Send status. Note every check it finds.

Open each stuck paycheck, open its details, and make a harmless edit: add an asterisk to the memo field and save the check. Then open it again, remove the asterisk, and save once more. The double save forces QuickBooks to rewrite the check's status.

After toggling every stuck check, run the payroll update again from Employees, Get Payroll Updates.

Still Failing?

Verify the payroll subscription. Employees, My Payroll Service, Account/Billing Information. An expired or unverified subscription produces the same PSXXX error family.

Rebuild the company file. File, Utilities, Rebuild Data, then Verify Data. PS038 sometimes rides on minor data corruption, and Intuit's own fix list includes a rebuild.

Intuit's full write-up is here: Resolve payroll error PS038.

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