Issue

When setting up Payroll for Pennsylvania, a city tax needs to be calculated, it is a flat $50 fee per person + a percent of their gross wages.

Also, an Earned Income tax report and Local Services report need to be generated.

Solution

Setup

Sub-Table and Sub-Accounts

In General Ledger, expand the Master File Maintenance menu and go to the 82 Sub-Table. Create a Sub-Table for the City/County tax codes.

Example:

Next, create a Sub-Account for each tax code that will be set up.  It's not required, but it may be helpful if the Sub-Account code is the same name as the Payroll Detail Code name that will be set up.

Example:

Account Number

Now, create a Liability account number that will be used when setting up the Payroll Detail Code.  Make sure it has the Sub-Table we just created.

Example:

Set up any other Account Numbers you will need for the different tax codes.  For example, will you use a different Account Number for the flat fee than the percentage?

Detail Codes

City and county taxes can be set up in the payroll system using special "T" tax detail codes. To do this, go to Payroll > Basic Options > Detail Codes.

Click + to add a new record.  Enter the Code and Description.  The Type must be T-Tax.

Percentage

For this example, we are setting up a Calculation Method of P-Percentage to capture the percentage of Gross Wages.

The client will need to know the percentage and Construct Base they need.  In my example below, I am basing the tax on 100% of Salary.  If the employee is hourly, then a different Construct would need to be used.

The Credit (Liability) section will be set to a Fixed Account/Sub-Account using the Account and Sub-Table we set up earlier.  In my example, the Sub-Account code is the same as the Detail Code, which helps me keep track.

Example:

Flat Fee

For this example, we are setting up a calculation method for the F-Fixed dollar amount.  The Type will still be T for Tax.  You can either choose to use the Fixed Amount at the Company Level (on this screen) or at the Employee Level (through Employee Master).  If the amount is the same for everyone, it would be best to set it here.

The Fixed Amount will be the amount deducted from EACH PAYROLL.

The Credit (Liability) section will be set to a Fixed Account/Sub-Account using the Account and Sub-Table we set up earlier.  In my example, the Sub-Account code is the same as the Detail Code, which helps me keep track.

Example:

Repeat this step until all the Tax Codes have been set up.

Employee Master

Add the needed detail codes to the employees. If a rate was not set at the company level, it can be set at the Employee Level.

Example:

Reports

State Unemployment Report

Pennsylvania also has a State Unemployment Tax that employees must pay.  PakEnergy has a report that automatically calculates that for PA employees.  

This report is found in Payroll > Reports-Quarterly > # 45 State Unemployment. Change the state to PA. This report automatically calculates the normal PA SUTA taxes and reports the employee portion they paid.

User Defined Reports

The U-1 Report Definitions menu in the Payroll > Reports > User Defined tab allows you to build a custom report.

1. To build a report, click on Add at the bottom of the screen.  Enter the report name and description.  The Report Name is selected to print reports; therefore, it must be unique to this report.  
   NOTE: When you select ADD, you can copy the new report from an already-setup report.
2. Set up each column to print on the report.  
   1. Select Detail Codes, enter the heading to print at the top of the column, and select the information to print in the column.  
   2. To select the details or combination of details to print, click on the white box under the heading.  A pop-up box will appear that lists all available payroll items.  Move the detail you want on the report to the correct part of the screen and select OK.
   3. Additional options are to reverse the sign and not print the line if it is zero.
      
      
3. To add a total column, select the Sum of Columns option.  To select the columns to include in the total, click on the white box under the heading.  A pop-up box will appear that lists all the previously set up columns.  Move the columns you want in the total to the correct part of the screen and select OK.
4. Once the report definitions are saved, they are available for printing under the U-2 Print Defined report.  The report can also be saved as a CSV, XLS, or XLS file.
   
   

NOTES:

• This report provides the option to include the current cycle, historical cycle, or both in the report itself.
• To edit a report, you will need to go to report definitions to edit your report.  Use the Edit Report Definitions button to quickly go to your selected report.  The right-click will allow you to edit, insert, or delete a column in the report.
• Detail codes with special characters at the end are editable.