Now that I made it through the January crazies, I'm taking the time to share my experiences. I've been watching for similar posts where others ran into W2 nightmares and am amazed I haven't seen any. I only have 2 clients using the new payroll and it still bit me.
I ran into the issue where supplemental bonus wages didn't hit the Fed and State taxable wages box. Sage has it written up as "Supplemental Bonus Withholding Wages do not display on Quarterly Tax Report" - Defect #109245. They released a fix for it, but it didn't go back to fix amounts that had already been run through so we ended up having to manually override Fed and State wages for over 80 employees. At least I can consider this issue resolved at this point.
I've been fighting with Sage for a month on the supplemental wage rate for WI being wrong. It was written up as an issue back on 5/9/18 - Defect ID #109300. The workaround is to manually calculate taxes. They have 4% taxes being withheld instead of 6.27% which is the rate for the salary range where most employees fall. The concerns I reported to them are 1) it can't take 9+ months to fix payroll issues; 2) why under-withhold the taxes instead of plugging in the 6.27% rate if you're going to plug a rate; they say I can't expect a quick fix for something like that. I say changing 4 to 6.27 seems pretty easy to me; 3) you can't expect users to manually calculate taxes when they're dealing with many employees. Technically I think that's true even when they have just a few employees, but that's because I know the skill set of most of my users doing payroll. Jeri argues they shouldn't be processing payroll if they can't do it manually. That may be true but that's not the world I deal with.
It eventually got escalated to Linda Cade and she seemed to care about my concerns. She told me a fix was going to be released last week. I installed the latest payroll update and the latest tax table update. I ran tests and confirmed it's still calculating the wrong state taxes. Linda did a new write-up for the KB and the way it's written, it confirms they're not annualizing wages like they're supposed to for the calculation. They're just taking YTD wages plus current wages and then applying the table. I called back to report my findings and was told by Jeri that users have to do manual taxes any time they want to process a payroll run with supplemental wages. Since that's her answer to the other defect I've been dealing with as well, I asked what's the point of having a payroll system then. If we have to do manual taxes for everything, we might as well hand write the paychecks. She cut me off at that point and said she'll have Linda call me.
I also ran into the issue where GT Life > 50,000 wasn't handled correctly by the system when it was processed as a fringe. The wages showed up as taxable for Federal, but not for FICA and Medicare. That meant we had to manually override FICA and Medicare wages as well as tax amounts, and the client will get hit with penalties and interest for paying the taxes late. There are 2 tax rules with GT Life in the description - 800019 Group Term Life Wages Not Subject to WH and 8000113 Group Term Life Wages Subject to Withholding. Neither one includes the wages as being taxable for FICA and Medicare. They're telling me the workaround is to find a tax rule that behaves the way I need it to - no matter what it's called. I went through all the tax rules and couldn't find one so I threw it back at them to tell me which one I'm supposed to pick. I'm still waiting for an answer on that. The concerns I reported to them are 1) why have tax rules called GT life that are wrong; 2) users don't call me every time they have to set up an earnings code or a deduction code, so how are they supposed to know that they're supposed to pick XXX tax rule and that neither of the existing GT life rules are right; 3) say I pick XXX tax rule for the GT life earnings code; what's to stop someone from looking at it down the road and wonder why would someone have picked that rule that doesn't look like it has anything to do with GT life and change it. The response I got was users are supposed to manually calculate taxes and make sure the rule selected works correctly. I argued that even if they do that, what do they do when they don't find a tax rule that works like they need it to, like we have in this instance. Their response - you guessed it - do manual taxes when processing GT life.
My client that ran into both the supplemental bug and this GT life mess spent 2 full days overriding wage amounts and taxes for all of his employees.
I thought that the two clients I installed Sage 2018 for had pretty simple payrolls compared to many of the other clients I work with. Knowing the W2 mess these two had to deal with, I'm wondering how I can possibly justify upgrading anyone else. So my questions to all of you:
Have you been doing the new payroll installations?
Are there outstanding issues you've uncovered that haven't been addressed yet?
How can I be the only one who ran into GT Life issues? Sage insists I'm the only one who reported it.
Are you comfortable recommending manual tax calculation to your users?
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Mary Jo Krueger
Senior Software Consultant
Schenck SC
Appleton WI
920-996-1176
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