Sage 100

Client owner wants to make a YE contribution to his IRA.  Payroll has been closed for 2024 and they are running PR 2025.

I set up a new deduction code for the simple IRA (below).

I set up a check run for 12/31/24 and used a grossed up amount for the earnings code and the deduction code below.  I ran the tax calculation.  I was expecting a zero net check with only FICA/Medicare tax withheld.  Sage also calculated FIT/SIT resulting in a negative net check.

Did I overlook something?

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Jeff Schwenk
Owner
Bottomline Software, Inc.
Waynesboro VA
(540) 221-4444

Improving bottom lines for over 25 years!
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I'm confused - FIT/SIT are employer taxes only - how did they make the check negative?

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Beth Bowers
(269) 358-0989
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You have the deduction code calculating percentage of gross yet there is not a percentage entered.  Also, why don;t you set the payroll to Manual Taxes and just enter the amount you want.

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Doug Higgs
Midwest Commerce Solutions, Inc
(312) 315-0960
Chauffeur, Chef, and Personal Assistant to Sprinkles
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Not sure what state this is for but we're in PA and 401k doesn't reduce PA SIT. FIT will calculate on the gross up amount over the IRA deduction amount. So if your IRA deduction is for $10,000 but your gross up wages are $15,000 FIT will calculate on the $5,000 difference.  You could let it calculate the taxes, switch to manual taxes and override the FIT to get rid of the negative check.

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Dawn Kulbacki
Capitol Computer Systems, Inc.
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Let's just point out I was thinking SUI and FUI, not SIT and FIT.

And then again, maybe I should retire early.

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Beth Bowers
(269) 358-0989
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Original Message:
Sent: 01-07-2025 14:13
From: Dawn Kulbacki
Subject: Simple IRA Deduction

Not sure what state this is for but we're in PA and 401k doesn't reduce PA SIT. FIT will calculate on the gross up amount over the IRA deduction amount. So if your IRA deduction is for $10,000 but your gross up wages are $15,000 FIT will calculate on the $5,000 difference.  You could let it calculate the taxes, switch to manual taxes and override the FIT to get rid of the negative check.

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Dawn Kulbacki
Capitol Computer Systems, Inc.
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@Dawn Kulbacki - I think you have it.  I did gross up the check so it would make perfect sense that the amount over the deduction would be taxable.  Thank you very much.  I will switch to manual taxes and zero out the FIT/SIT amounts.  @Beth Bowers - Why are you waiting????  Do it know while there is time to be a Disney princess!!!!!!

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Jeff Schwenk
Owner
Bottomline Software, Inc.
Waynesboro VA
(540) 221-4444

Improving bottom lines for over 25 years!
------------------------------

Original Message:
Sent: 01-07-2025 14:14
From: Beth Bowers
Subject: Simple IRA Deduction

Let's just point out I was thinking SUI and FUI, not SIT and FIT.

And then again, maybe I should retire early.

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Beth Bowers
(269) 358-0989
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Original Message:
Sent: 01-07-2025 14:13
From: Dawn Kulbacki
Subject: Simple IRA Deduction

Not sure what state this is for but we're in PA and 401k doesn't reduce PA SIT. FIT will calculate on the gross up amount over the IRA deduction amount. So if your IRA deduction is for $10,000 but your gross up wages are $15,000 FIT will calculate on the $5,000 difference.  You could let it calculate the taxes, switch to manual taxes and override the FIT to get rid of the negative check.

------------------------------
Dawn Kulbacki
Capitol Computer Systems, Inc.