Tax Codes Setup Field List

The system supplies an identifying code for federal taxes, state taxes, and many supported local taxes (such as New York City and Yonkers).

At the Tax field, type a valid code or use the adjacent navigation buttons or Finder icon to select a tax. The Finder lists only those taxes that have already been activated for use with your payroll.

To add a new federal or state tax for your payroll, click the SelectFederal or State Taxbutton at the bottom of the window to display a list of all tax update-supported taxes, even the ones you have already activated.

The system displays a description for the tax you selected. You can accept the description supplied by the system or enter a new description. The Description field is required.

This button displays a list of taxes that are supported by Sage 300 Payroll tax updates. The taxes include all statutory federal and state income and payroll insurance taxes, plus New York City and Yonkers city income taxes.

From the list, select a tax that you want to activate.

You can enter an identifying code of up to six characters.

You can enter a description of up to 60 characters to display on some reports.

This button opens a list of local taxes from the program's tax repository. When setting up a new local tax record, if you select a local tax from the list, Sage 300 Payroll fills in fields on the Local and Other Custom Taxes form with available default information for that tax.

This button lets you update the local tax repository, a table of compliance data for local taxes that are supported by Sage 300 Payroll.

The repository is refreshed automatically whenever you activate a tax update, so you don't need to use this button unless there have been changes to the company's local.xml file between tax updates.

For more information on installing the Repository and updating local taxes, see Setting Up a Local Tax.

This button is available on the Local and Other Custom Taxes window when you display the code for a local tax that is stored in the program's repository of local taxes.

Use this button to update an existing local tax record with information from the repository, either to revert to the default tax information after editing a local tax, or to update the tax record after installing a new repository.

For Local and Other Custom Taxes, you select the type of tax from a list of available types. Click the down arrow to display the list. At this time, the only processing based on the type you enter here occurs when you produce the Unemployment Report. Information about all taxes (Federal/State and Local/Other) classified as Unemployment Tax at this field are included on the Unemployment Report.

The category Insurance Tax includes state disability insurance taxes.

For Federal and State Taxes, Type is a display-only field.

Enter a short description of up to 15 characters. The short description is required because it prints on W-2s (when applicable). Make the first part of the short description meaningful, since the entire 15 characters may not print in the space provided on the W-2. The short description is also used on certain reports and data entry windows in order to save space.

Enter up to 12 characters for the tax authority reporting ID, to print automatically on W-2s and other reports.

This field is used to determine which earnings and deductions and which other taxes can be included in the calculation base for each tax, as well as the order in which the calculation should occur. Learn more About Tax Levels.

Select the Inactive option if you want to prevent this tax from being assigned to any new employees. If you choose to make a tax inactive, the system displays the current DOS date in the As Of field to indicate the date on which you changed the tax’s status.

Setting a tax’s status to Inactive has no effect on the payroll calculation of employees who have already been assigned the tax.

For taxes using the Flat, Amount Per Hour, Percentage Of Base, or Tax Bracket Table calculation method, select the deductions to be included in the calculation base of this tax. Each deduction you enter into the box is deducted from pay before the tax you are adding is calculated.

You can use this tab to assign default expense and liability accounts to any number of distribution codes. If the tax you add involves employee liability only, set up only an Employee Liability account for the distribution code. If the tax you add involves employer liability only, set up Employer Expense and Liability accounts for the distribution code. And, finally, if the tax you add involves employee and employer liability, you can set up accounts for Employee Liability, Employer Expense, and Employer Liability.

If you use cost center posting, when you calculate payroll the tax amounts are distributed to the cost centers in which the taxable wages were earned.

Type a distribution code of up to six characters to define the set of default G/L expense and liability accounts you are setting up.

Type a name or description for the distribution code, in up to 15 characters.

Enter the liability account to post the tax or earning/deduction for any employee assigned this distribution code.

Enter the Employer Expense account to post the employer's portion of this tax for any employee assigned this distribution code.

Enter the Employer Liability account to post the employer's liability for this tax or earning/deduction for any employee assigned this distribution code.

The Employer Liability account column displays in the G/L Distributions field for the following types of earnings/deductions and taxes:

• Percentage of Base vacation and sick time accruals for which you have selected the Post The Liability option.
• Reported Tips earnings for which you have selected the Tip Disbursement option.
• Employer-only and two-sided deductions.
• Noncash benefits that are marked for posting to the general ledger.
• Taxes or portions of taxes paid by the employer.

For Federal and State Taxes, if you select the Include for Employees by Default option on the Basic Info tab, you must set a distribution code as the default. Even if there is only one distribution code for the tax, you must manually set it as the default.

Use the Finder to select the optional field codes you want to use with this employee. You can select only the optional fields that you have already set up on the Payroll Optional Fields window. When you select an optional field code, the program displays the description for the optional field.

If you want to set a default value for the optional field, double-click in the Value Set column to change it to Yes.

The Yes flag in the Value Set field alerts the data entry clerk that a seemingly blank optional field actually has an entry. By looking at the Value field, you cannot tell whether it has a “blank” default value or no value at all.

Type the value, or use the Finder to select one.

• If the optional field you selected requires validation, you must select a value that is defined for the optional field in Common Services. However, if the optional field allows blanks, you can leave the default value field blank.
• If you select a value, the description of the value will appear in the Value Description column.

This field's label varies with the calculation method used by the tax:

• If the calculation method is Flat or Amount Per Hour, enter the amount to be deducted (or paid by the employer) for this tax.
• If the calculation method is one of the Percentage methods, enter the percentage to use to calculate the deduction (or the amount paid by the employer).

This field is not applicable if the calculation method is Tax Bracket Table.

Enter the annual withholding amount at which the system is to stop calculating the employee tax deduction.

If you are setting up a tax that uses the Percentage of Base calculation method, type the maximum amount of taxable earnings to withhold on in a year.

If you chose Other Information Box or Local Tax Box in the W-2 Reporting field, the Associate W-2 Printing option becomes available to you. Select this option if the tax you are setting up needs to be associated with another tax on the same Form W-2. Then, if an employee works in more than two states or localities and requires more than one Form W-2, you can be sure that the tax you are setting up displays on the same Forms W-2 as the taxing entity with which it is associated.

Type or select from the Finder the state or local tax with which you want to associate the tax you are adding. If you select Other Information Box in the W-2 Reporting field, you can associate the tax you are adding with a tax update-supported state or local tax. If you select Local Tax Box in the W-2 Reporting field, you can associate the tax you are setting up with a tax update-supported state tax only.

Select this box if you are defining an Amount Per Hour or Percentage Of Base tax, such as New York or Hawaii state disability insurance tax, that is calculated by the week rather than on an annualized basis.

If you select Combine With Another Tax from the W-2 Reporting drop-down menu, you must also enter the code of the tax with which you want to combine the tax you are setting up, or click the Finder button to select from a list of all configured taxes (federal, state, local, and custom).

Type the smallest and the largest amounts, base amounts, or number of units, based on your response at the Minimums And Maximums Based On field, that may be used in calculating the amount for each pay frequency your company uses.

The Minimum and Maximum fields are skipped if the Minimum/Maximum Based On field is set to No Limit.

From the list of options, choose the unit on which the period minimums and maximums for the tax are based. Your selections for entry in these fields depend upon your entry in the Employee or Employer Calculation Method field.

If the calculation method is:

• Amount Per Hour, select No Limit, Withholding, or Hours.
• Percentage Of Base, select No Limit, Withholding, or Base.

If you select No Limit, there will be no period minimum or maximum for the employee portion of the tax.

If you are defining a Percentage of Base or Tax Bracket Table tax that uses a supplemental rate, type the rate here.

From the list of options, choose the entry that applies to the tax:

Not Applicable. The tax is not printed on the Form W-2.

Other Information Box. The tax is printed in the Other Information box on the Form W-2.

Combine With Another Tax. The tax amount is added to another tax amount, which you specify in the next field, and the sum is printed in the State tax box on the Form W-2.

Local Tax Box.  The tax is printed in the Local tax box on the Form W-2.

If you select the Calculate Minimum/Maximum Based On Tax Weeks Worked option (for an Amount Per Hour or Percentage Of Base tax), you also enter the weekly amount at which calculations for this tax will stop.

If you select the Calculate Minimum/Maximum Based On Tax Weeks Worked option (for an Amount Per Hour or Percentage Of Base tax), you also enter the smallest weekly amount that can be calculated for this tax.

In this field, type the dollar amount deduction to be deducted from wages that fall in the bracket.

This column displays the lower limit (dollar amount of wages) of each range for which you set a specific tax or earning/deduction amount and percentage of excess. The system displays zeroes as the first lower limit, and the upper limit of the previous range (plus a penny) for each subsequent lower limit.

This column automatically displays, for each range of wages, the upper limit of the range in the previous row. For example, on a line that covers wages falling between $15,000.01 and $20,000, the Of Excess Over field displays $15,000.

Sage 300 Payroll applies the percent entered in the Plus Percent column to the wages over this amount. You cannot edit the Of Excess Over field.

Enter the percentage to be applied to the amount of employee wages that exceeds the upper limit of the range in the previous row in the bracket table. The product of this calculation is also deducted from wages.

Type the upper limit (dollar amount of wages) of each range for which you have set a specific tax or earning/deduction amount and percentage of excess. As you enter an amount on one line of the To column, the system defaults 999,999,999,999,999.99 on the next line of the To column. 999,999,999,999,999.99 represents the uppermost limit of the wage bracket table.