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GROSS-UP AWARD PROCESS#

Certain payments are made to employees which are "grossed up" so that the after tax net pay is the target payment. If an employee is to receive a $500.00 payment after tax, then a gross up amount must be calculated so that the gross pay is increased to reflect an after tax payment of $500.00.

Wiki uses third party software for legislative calculations. As a result there are no tax rates held in Wiki. In order to calculate the gross up amount the federal, state, FICA and Medicare deduction percentages are referenced from user variables. These are then applied to the target amount to be paid to arrive at a gross pay which will, after all deductions are taken be the target amount.

IMVR - User Variables#

The tax rates are stored in the Vertex software and as such, Wiki has no facility to access them for use in a process such as a gross-up. Tax percentages have been set up in the following user variables:

Variable code	Percentage
GU_FED_SUPP	25
GU_FICA	6.2
GU_MEDICARE	1.45
GU_NJ_TAX RATE	5.5
GU_NYC_TAX _RATE	4
GU_NYS-TAX RATE	9.77
GU_PA_TAX_RATE	3.07
GU_PHIL_TAX_RATE	3.9296
GU_RR_TIER2	3.9
GU_SUI_NJ	.425
GU_SUI_PA	.09

Note that these may have to be updated if tax rates change.

If there is a change in a tax rate, it will not be seen in the net pay result of the gross-up calculation as any difference between the target amount and the result of the legislative calculation's net pay is adjusted to equal the target amount. The difference is added to the federal tax deduction which may then reflect a higher-than intended deduction.

The BONUS pay category must be selected for Gross Up calculations.

All of these UserCalc's will only perform calculations if there is a value in PC2500, Gross Up payment.

UserCalc PR-2500_GROSS_UP#

This UserCalc will calculate the amount to be added to the target net pay to be paid to the employee. It is placed at sequence 10, 60-Gov't Calculations, before legislative calculations are triggered at sequence 100.

GrossUpAwardProcess_01.jpg

UserCalc PR-2500_FICA_MED#

This UserCalc will check to determine if FICA and/or Medicare are at a zero deduction rate, caused by reaching their respective caps. If either of these is a zero deduction, then the grossed up gross pay will be reduced to reflect no FICA and/or Medicare deductions.

This UserCalc is placed at sequence 20, 70-After Govt Calcs. If either FICA and/or Medicare are at zero values, the pay calc will continue in this sequence to re-calculate the legislative calculations. If there is no change to FICA and/or Medicare then the pay point type is exited before a re-calc of taxes.

GrossUpAwardProcess_02.jpg

User Calc PR-2500_GU_ADJST#

This UserCalc will compare the target amount and the calculated net pay from the grossed up gross and if there is a difference, it will be added to the net pay to insure that it will be exactly the target payment amount.

GrossUpAwardProcess_03.jpg

IPPP - Define Pay Points#

GrossUpAwardProcess_04.jpg

IPPGU - US Pay Categories#

GrossUpAwardProcess_05.jpg

Process to Pay and Achievement Award with a gross up.#

Achievement awards are paid in separate checks from a regular pay.

1. Create a pay header(s) using the 'Gross Up' pay category.
   • UPCPAY can be used for a manageable group of employees to be paid. In this case, PC2500 will be manually added to the pay headers with the achievement amount entered for each employee (the target amount).
   • For a large number of employees, it may be more practical to use an Excel spread sheet to create a data load into IPTL which will then be loaded into pay headers using UPTL. This will consist of the employee number, date and amount. All other information will be defaulted into the IDIF that controls the load. (No IDIF has yet been built to load this data. If required a request should be entered to build it).
2. The GROSS UP pay category will use the Federal Supplemental and State Supplemental percentage rates for the tax calculations. These are set as overrides to individual employee IPRLU settings.

Gross Up User Calc for Canada#

Global Name	Global	Type Global Length	Initial Value
BK Stat payout	Number		0
Def_comp_ded	Number		0
EARNINGS	Number		0
Fl_Hol_entitle	Number		0
G_OT_Payout	Number		0
G_current_OT	Number		0
Gross_up_value	Number		0
Payout $	Number		0
SUNOT	Number		0
banked OT payout	Number		0
jan2	Date
service-date	Date
time lost	Number		0

Canadian Gross Up Award UserCalcs#

Run By: P2K RMUC-20031113 User: P2K Product: PR Name: PR-GROSSUP_1 Usage:

Variable Name	Variable Type	Variable Length	Initial Value
Tax-Fed Number	Number		0
Tax-St	Number		0

Line	Com.	Operand 1	Oper.	Operand 2	Operand 3	Go To	Else	Description
10	LET	Variable Tax-Fed	PRC	Element-Current (N) GROSS	User Consant TAX_%_FED	20		Calculate Federal and state taxes on a gross up amount based on User Variables holding the tax rate percentages. This UserCalc is in IPPP before taxes are calculated. ++++++++++++++++++++++++ ++++++++++++++++++++++++ ++++++++++++++++++++++++ Load Federal tax calc into a variable
20	LET	Variable Tax-St	PRC	Element-Current (N) GROSS	User Consant TAX_%_STATE	30		Load State taxes into a variable
30	LET	Global Variable Gross_up_value	EQ	Pay Component - Current (N) 2011		40		Load the entered gross up amount, before estimated taxes are added, to be picked up by UserCalc PR-GROSSUP_2.
40	LET	Pay Component - Current (N) 2110	ADD	Pay Component - Current (N) 2011	Variable Tax-Fed	50		Add Fed taxes to gross up amount
50	LET	Pay Component - Current (N) 2110	ADD	Pay Component - Current (N) 2011	Variable Tax-St	99999		Add state taxes to gross up amount. This will represent the gross up + federal and state taxes based on UV percentages.
99999	EXIT

User: P2K Product: PR Name: PR-GROSSUP_2 Usage: 20 LET Variable 30 LET Global Variable 40 LET Pay Component - Current (N) 50 LET Pay Component - Current (N) 99999 EXIT Tax-Fed Tax-St Gross_up_value 2110 2110 Variable Name Variable Type Fed_difference Number State_difference Number difference Number net_pay Number User Calcs 28-May-2004 16:44:47 Personality 2000 Page: 1 of 2 Type: Calculation Return Value: Status: In Production Description: Calc taxes using fixed percent Variable Length Initial Value 0 0 Oper. Operand 2 Operand 3 Go to Else Description Type: Calculation Return Value: Status: In Production Description: Element - Current (N) User Consant 30 Load State taxes into a EQ Pay Component - Current (N) 40 Load the entered grossADD Pay Component - Current (N) Variable 99999 add state taxes to grossGROSS TAX_%_FED state taxes on a grossGROSS TAX_%_STATE varaible 2110 up amount, before2110 Tax-Fed up amount 2110 Tax-St up amount. This willup amount based on UserVariables holding thetax rate percentages.This user calc is in IPPP before taxes are calculated Load Federal tax calc into a variable estimated taxes are added, to be picked upby user calc PRGROSSUP_2. ADD Pay Component - Current (N) Variable 50 Add Fed taxes to grossrepresent the gross up +federal and state taxes based on UV percentages Variable Length Initial Value 0 0 0 0 RMUC-20031113 Personality 2000 Page: 2 of 2 Run By: P2K User Calcs 28-May-2004 16:44:47

Line	Com.	Operand 1	Oper.	Operand 2	Operand 3	Go to	Else	Description
10	LET	Variable net_pay	SUB	Element - Current (N) GROSS	Element - Current (N) DEDUCTIONS	20	This UserCalc finds the difference between the estimated gross up taxes and the calculated taxes. The difference is prorated and added back to the Fed and State tax deduction so that the Net Pay is the amount of the gross up pay before tax estimates are added. This UserCalc must be in the 70-After Govt Calc pay point type in IPPP ++++++++++++++++++++++++ ++++++++++++++++++++++++ ++++++++++++++++++++
20	IF	Global Variable Gross_up_value	EQ	Variable net_pay		99999	30	Determine the net pay If the gross up value is the same as net pay,exit
30	LET	Variable difference	SUB	Variable net_pay	Global Variable Gross_up_value	40	Determine the difference between the net pay and the gross up value
40	LET	Variable Fed_difference	DIV	User Constant TAX_%_STATE	User Constant TAX_%_FED	50	Determine the ratio of Fed to State taxes and load into variable. This will be the factor to multiply the difference by to determine what portion is for Fed taxes.
50	LET	Variable MLT Variable Variable 60 This is the emount that

Fed_difference difference Fed_difference is the Federal Tax difference

60 LET Variable SUB Variable Variable 70 This is the amount that

State_difference difference Fed_difference is the State Tax difference

70 LET 6000 Pay Component - Current (N) ADD 6000 Pay Component - Current (N) Fed_difference Variable 80 Add the Federal Tax differenc to exisitingFederal Tax deduction

80 LET 6020 Pay Component - Current (N) ADD 6020 Pay Component - Current (N) State_difference Variable 99999 Add the State Tax difference to the existing State Taxdifference

99999 EXIT

Personality 2000

Notes #

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