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Medicare Catch Up

  • 1.  Medicare Catch Up

    Posted 10-17-2019 18:09
    A customer upgraded from  v2017 to v2017 in July. They discovered recently that 3 employees were set to exempt on medicare but should not have been. They were set correctly in v2017. So some paychecks after the upgrade did not have medicare withheld. Employee maintenance has been fixed, but the system has not caught up the medicare withholding. I thought that the software would do that. What should the customer do? Manual override?

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    Karen O'Lane
    Accounting Systems, Inc. (ASI)
    Fresno CA
    803.252.6154 x242
    559.577.4142
    90Minds Board Member at Large
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  • 2.  RE: Medicare Catch Up

    Posted 11-03-2019 23:01
    Sorry, I meant that they upgraded from v2017 to v2019. Sage support confirmed that the new framework versions will NOT catch up the taxes. You must manually figure it out and then do an override in payroll data entry.

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    Karen O'Lane
    Accounting Systems, Inc. (ASI)
    Fresno CA
    803.252.6154 x242
    559.577.4142
    90Minds Board Member at Large
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  • 3.  RE: Medicare Catch Up

    Posted 11-04-2019 23:40
    So what if the employER taxes were hosed.  How do you manually adjust them?  Also, I don't think the legacy PR looked at taxes on a YTD basis either.

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    Jeff Schwenk
    FORMER 90M Board Member
    Bottomline Software, Inc.
    Waynesboro VA
    540-221-4444
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  • 4.  RE: Medicare Catch Up

    Posted 11-12-2019 14:14
    Along these lines, I was wondering what the options are for overriding anything calculated by the PR tax engine in the sky.  I think it was not possible last I heard but need to find out for sure for a client who tinkers with the numbers all the time.

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    Rhonda McNamara
    Customer Success Manager
    Stewart Technologies, Inc.
    rsm@stewarttechnologies.com
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  • 5.  RE: Medicare Catch Up

    Posted 11-12-2019 14:33
    Wow, what timing - Just received a client email regarding Christmas bonuses and how do you override the supplemental tax calc to zero.  It is taxable but she wants the employees to feel the holiday love.  I suggested manual tax override.  She replied Bah Humbug.  NOT for three hundred employees. ....  Any thoughts?

    TIA

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    Jeff Schwenk
    FORMER 90M Board Member
    Bottomline Software, Inc.
    Waynesboro VA
    540-221-4444
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  • 6.  RE: Medicare Catch Up

    Posted 11-12-2019 14:46
    @Jeff Schwenk The Earnings Code can be assigned a tax rule for those earnings to not be taxable.  I'd recommend creating a code that will only be used for the Christmas Bonus. ​

    @Rhonda McNamara Do you mean during the Payroll process or after it's posted?​

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    Michelle Taylor
    ERP Consulting Manager, CS3 Technology
    918-388-9772
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  • 7.  RE: Medicare Catch Up

    Posted 11-12-2019 16:07
    @Michelle Taylor  You really don't want to flag that earnings code as not taxable right?  The wages are taxable but you just don't want tax withheld.  They need to show in the correct taxable wage boxes on the W2.  There's a tax rule called bonus wages and one called supplemental bonus wages.  During testing with clients I found the one called bonus wages withholds at "normal" tax rates and the supplemental one withholds at the higher rate.  I don't  know a way to override those taxes without doing manual taxes so if you can provide more info, that would be awesome.  ​

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    Mary Jo Krueger
    Senior Software Consultant
    CLA (CliftonLarsonAllen LLP)
    Appleton WI
    920-996-1176
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  • 8.  RE: Medicare Catch Up

    Posted 11-12-2019 16:16
    hear what you're saying @Mary Jo Krueger and agree, just sharing options.  I do discuss options with customers, and remind them to seek guidance with the CPA, but ultimately leave it up to them to decide things like that.​

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    Michelle Taylor
    ERP Consulting Manager, CS3 Technology
    918-388-9772
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  • 9.  RE: Medicare Catch Up

    Posted 11-12-2019 16:12
    @Michelle Taylor​​ - Thanks for the response.  How do you do that.  I want a tax code that reflects the taxable nature of the bonus (100% taxable, FIT, SIT, FICA, MEDICARE, but I want to calculate and withhold ZERO FIT/SIT.  Can you create tax codes to do this?  Or do you create a new tax profile and deselect the applicable tax withholding options on the right side?

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    Jeff Schwenk
    FORMER 90M Board Member
    Bottomline Software, Inc.
    Waynesboro VA
    540-221-4444
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  • 10.  RE: Medicare Catch Up

    Posted 11-12-2019 17:54
    Hi @Jeff Schwenk There is a tax rule on the earnings code, but not that will control that detailed of a​ the processing.  Since they have so many employees that (seem to need taxes  modified for this payrun), what do you think about exporting the entry, and re-importing with manual taxes set as desired?  I would use all the same figures from the export except the FIT & SIT.  Think that would be much shorter than manually changing every entry (and very glad they are thinking ahead!).

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    Michelle Taylor
    ERP Consulting Manager, CS3 Technology
    918-388-9772
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  • 11.  RE: Medicare Catch Up

    Posted 11-13-2019 10:33
    @Michelle Taylor I was meaning during payroll.  My client (a cpa) regularly changes withholding and taxes.  All above board, but manually. Would she need to not have the tax engine calculate them at all, and manually calculate the whole thing?

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    ==================
    Rhonda McNamara
    Customer Success Manager
    Stewart Technologies, Inc.
    rsm@stewarttechnologies.com
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  • 12.  RE: Medicare Catch Up

    Posted 11-13-2019 10:47
    Hi @Rhonda McNamara Would have to inquire more of the "why" for the tinkering, but I am not a CPA, I just dig for info a lot!  Maybe knowing is more curiosity. ​  Don't see anything wrong with running the tax calculation, then going back to the entry to change to Manual Taxes and modifying.  I'd do it that way, if only to see what the program is calculating. Makes me wonder more if there could be a better tax rule applied, and that goes back to the "why" for the tinkering.

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    Michelle Taylor
    ERP Consulting Manager, CS3 Technology
    918-388-9772
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  • 13.  RE: Medicare Catch Up

    Posted 11-13-2019 11:15
    Are the employees all in the same Tax Profile?  What if just prior to running the Christmas Bonus, the payroll person accesses the Tax Profile, unchecks the taxes he/she doesn't want to have calculate.  Run the payroll and then turn them back on.  Obviously they need to take screen shots of the before and after.
    N

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    Nancy Hanson
    Blytheco LLC
    Eagan MN
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  • 14.  RE: Medicare Catch Up

    Posted 11-13-2019 12:15
    I'd never do it justice.  One scenario is about a business that bought another business so the employee's YTD stuff is relevant, but the employer is suddenly a new employer, mid year, thresholds, yada yada yada.  But I actually didn't know you could let it calculate and then override it, so I think that'll be a life saver!  She's one of those people who has had to tell Sage they're calculating wrong before. :-D  So she doesn't want to be held up while they figure stuff out.  I think the employees for most of the payrolls she runs will be in just a handful of profiles, so that might help too. Thanks all!

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    Rhonda McNamara
    Customer Success Manager
    Stewart Technologies, Inc.
    rsm@stewarttechnologies.com
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  • 15.  RE: Medicare Catch Up

    Posted 11-13-2019 12:17
    Ah, I see!  Hope that the slight change helps!  Good luck to her :)

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    Michelle Taylor
    ERP Consulting Manager, CS3 Technology
    918-388-9772
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  • 16.  RE: Medicare Catch Up

    Posted 11-13-2019 19:09
    Are you sure that unchecking tax withholding in the profile is going to do the correct thing?

    I would think that would make the wages non-taxable,  not just stop the withholding.  You want it to be taxable,  just not withhold FIT.

    You might want to test that out in a test environment first.

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    Thomas Rogers (TomTarget)
    Target System Technology, Inc.
    Spokane Valley WA
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