This page (revision-7) was last changed on 26-Nov-2021 10:22 by jescott

This page was created on 26-Nov-2021 10:22 by jescott

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US Self Adjust Tax Method
US Self Adjust Tax Method

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At line 50 changed 9 lines
__‘Self Adjust’ Definition__ \\
The ‘Self-Adjust’ method evaluates the YTD Earnings and YTD tax amounts every pay to ensure they are consistent and correct at each pay with a given tax rate until all Subject Earnings reach the Annual Maximum Earnings. This facilitates the accurate tax information for the monthly, quarterly reporting and the annual year-end report of W2
At each pay, when user is verifying the Pay Register’s Subject Earnings, the Subject Earnings is derived from current pay’s earnings less taxable benefits
At each pay, when user is verifying the Pay Register’s tax result, the tax amount is the result of the current pay’s Subject Earnings multiply by rate and the adjusted YTD tax amount
Therefore user must verify from both the YTD value and CTD value, it is not just Subject Earnings * Rate
;Self Adjust’ Definition: The ‘Self-Adjust’ method evaluates the YTD Earnings and YTD tax amounts every pay to ensure they are consistent and correct at each pay with a given tax rate until all Subject Earnings reach the Annual Maximum Earnings. This facilitates the accurate tax information for the monthly, quarterly reporting and the annual year-end report of W2 \\ \\ At each pay, when user is verifying the Pay Register’s Subject Earnings, the Subject Earnings is derived from current pay’s earnings less taxable benefits \\ \\At each pay, when user is verifying the Pay Register’s tax result, the tax amount is the result of the current pay’s Subject Earnings multiply by rate and the adjusted YTD tax amount \\ \\Therefore user must verify from both the YTD value and CTD value, it is not just Subject Earnings * Rate
At line 61 changed one line
__‘No Self Adjust’ Definition__ \\
;‘No Self Adjust’ Definition: The ‘No Self-Adjust’ method does not evaluate the YTD Earnings and YTD tax amounts every pay, it takes the CTD Subject Earnings multiply by the rate until all Subject Earnings reaches the Annual Maximum Earnings. This ensures the Annual Maximum Earnings and Deductions are capped and allowing multiple rates to be used for a tax type. This facilitates the accurate tax information for the monthly, quarterly reporting and the annual year-end report of W2 \\ \\At each pay, when user is verifying the Pay Register’s Subject Earnings, the Subject Earnings is derived from current pay’s earnings less taxable benefits \\ \\At each pay, when user is verifying the Pay Register’s tax result, the tax amount is the result of the current pay’s Subject Earnings multiply by rate
At line 63 removed one line
The ‘No Self-Adjust’ method does not evaluate the YTD Earnings and YTD tax amounts every pay, it takes the CTD Subject Earnings multiply by the rate until all Subject Earnings reaches the Annual Maximum Earnings. This ensures the Annual Maximum Earnings and Deductions are capped and allowing multiple rates to be used for a tax type. This facilitates the accurate tax information for the monthly, quarterly reporting and the annual year-end report of W2
At line 65 removed 5 lines
At each pay, when user is verifying the Pay Register’s Subject Earnings, the Subject Earnings is derived from current pay’s earnings less taxable benefits
At each pay, when user is verifying the Pay Register’s tax result, the tax amount is the result of the current pay’s Subject Earnings multiply by rate
At line 75 changed 2 lines
\\
1. Change of Earnings Element set up, e.g. user forgets to include a pay component in the Pre-Earnings Element\\
# Change of Earnings Element set up, e.g. user forgets to include a pay component in the Pre-Earnings Element
# Change of Benefits Element set up, e.g. user forgets to include a pay component in Pre-Benefits Element, i.e. 125 or 401K
# Negative YTD Benefit amount, e.g. an Adjustment pay is refunding 125 plan or 401K for rehired employee
# When paying a Hand Check, e.g. a hand check is issued quickly with some estimated amounts, then user expects UPCALC to use Self-Adjust methods to calculate the correct tax amounts in the following pay
# Employee is changed from Exempt Employment to Non-Exempt Employment, or vice versa
At line 78 removed 8 lines
2. Change of Benefits Element set up, e.g. user forgets to include a pay component in Pre-Benefits Element, i.e. 125 or 401K\\
3. Negative YTD Benefit amount, e.g. an Adjustment pay is refunding 125 plan or 401K for rehired employee\\
4. When paying a Hand Check, e.g. a hand check is issued quickly with some estimated amounts, then user expects UPCALC to use Self-Adjust methods to calculate the correct tax amounts in the following pay\\
5. Employee is changed from Exempt Employment to Non-Exempt Employment, or vice versa\\
At line 117 added 23 lines
**FIT Earn = Reg Earn – Benefits portion of Reg Earn
**FSP Earn = Fsp Earn – Benefits portion of Fsp Earn
**Total Pre-tax Benefits for Fed tax = 125 plan + 401K
***= -20 + (-10) = -30
**Benefits portion of Reg Earn = Reg Earn / (Reg Earn + Sup Earn) * Taxable Benefits
*** = -200 / (-200 + -100) * -30
*** = -200 / -300 * -30
*** = -20
**FIT Earn = -200 – (-20) = -180 (correct)
**Benefits portion of Sup Earn = Sup Earn / (Reg Earn + Sup Earn) * Taxable Benefits
*** = -100 / (-200 + -100) * -30
*** = -100 / -300 * -30
*** = -10
**FSP Earn = -100 – (-10) = -90 (correct)
*PC 8027 FUTA EARN $-280.00
**FUTA Earn = (Reg Earn + Sup Earn) – 125 plan
*** = (-200 + -100) – (-20)
*** = -300 – (-20)
*** = -280 (correct)
*PC 8031 Med EE Earns $-280.00 = similar to FUTA Earn
*PC 8035 Med ER Earns $-280.00 = similar to FUTA Earn
*PC 8037 FICA EE Earns $-280.00 = similar to FUTA Earn
*PC 8039 FICA ER Earns $-280.00 = similar to FUTA Earn
At line 137 changed one line
FIT Earn = Reg Earn – Benefits portion of Reg Earn \\
After UPCLOZ, the YTD amounts will be adjusted to reflect this Adjustment pay
At line 139 changed one line
FSP Earn = Fsp Earn – Benefits portion of Fsp Earn \\
*PC 3001 125 Plan 152.22 + (-20) = $-132.22 (correct)
*PC 3002 401K Plan 127.31 + (-10) = $-117.31 (correct)
*PC 8005 FIT EARN 2024.41 + (-180.00) = $1844.41 (correct)
*PC 8015 FSP EARN 0 + (-90.00) = $-90 (correct)
*PC 8027 FUTA EARN 2095.05 + (-280.00) = $1815.05 (correct)
*PC 8031 Med EE Earns 2437.52 + (-280.00) = $2157.52 (correct)
*PC 8035 Med ER Earns 2437.52 + (-280.00) = $2157.52 (correct)
*PC 8037 FICA EE Earns 2437.52 + (-280.00) = $2157.52 (correct)
*PC 8039 FICA ER Earns 2437.52 + (-280.00) = $2157.52 (correct)
At line 141 removed 42 lines
Total Pre-tax Benefits for Fed tax = 125 plan + 401K \\
= -20 + (-10) = -30 \\
\\
Benefits portion of Reg Earn = Reg Earn / (Reg Earn + Sup Earn) * Taxable Benefits \\
= -200 / (-200 + -100) * -30 \\
= -200 / -300 * -30 \\
= -20 \\
FIT Earn = -200 – (-20) = -180 (correct) \\
Benefits portion of Sup Earn = Sup Earn / (Reg Earn + Sup Earn) * Taxable Benefits \\
= -100 / (-200 + -100) * -30 \\
= -100 / -300 * -30 \\
= -10 \\
FSP Earn = -100 – (-10) = -90 (correct)
PC 8027 FUTA EARN -280.00
FUTA Earn = (Reg Earn + Sup Earn) – 125 plan
= (-200 + -100) – (-20)
= -300 – (-20)
= -280 (correct)
8031 Med EE Earns -280.00 = similar to FUTA Earn
8035 Med ER Earns -280.00 = similar to FUTA Earn
8037 FICA EE Earns -280.00 = similar to FUTA Earn
8039 FICA ER Earns -280.00 = similar to FUTA Earn
- after UPCLOZ, the YTD amounts will be adjusted to reflect this Adjustment pay
3001 125 Plan 152.22 + (-20) = -132.22 (correct)
3002 401K Plan 127.31 + (-10) = -117.31 (correct)
8005 FIT EARN 2024.41 + (-180.00) = 1844.41 (correct)
8015 FSP EARN 0 + (-90.00) = -90 (correct)
8027 FUTA EARN 2095.05 + (-280.00) = 1815.05 (correct)
8031 Med EE Earns 2437.52 + (-280.00) = 2157.52 (correct)
8035 Med ER Earns 2437.52 + (-280.00) = 2157.52 (correct)
8037 FICA EE Earns 2437.52 + (-280.00) = 2157.52 (correct)
8039 FICA ER Earns 2437.52 + (-280.00) = 2157.52 (correct)
At line 155 added 2 lines
#When FUTA, FICA, MEDI Tax Method = ‘No Self Adjust’
This page (revision-7) was last changed on 26-Nov-2021 10:22 by jescottTop