Sage 100

I don't know that there is a tax rule that allows you to not calculate the withholding taxes, and yet reports those wages as taxable.  I've asked for it, and maybe it is there now – but it would be fabulous if they would add that rule.

Barring us finding a rule that does work, I don't think you should do an import for FICA/Medicare because of two reasons:  1) if the employee is over or nearing the FICA limit, you might be over-withholding FICA, and 2) likewise, if they're approaching or over the $200,000 Medicare supplemental, you might be under-withholding Medicare.  I've always grossed up the amount to cover FICA/Medicare (taking into account Employees who are just under or over the FICA limit, plus those who are at or nearing the $200k Medicare supplemental), let the system calculate the taxes, and then zero'd out the two Withholding taxes.  If only part of the bonus puts them over either the FICA limit, or only part of the bonus is applicable to the $200k supplemental for Medicare, the system will calculate that correctly.  And you can easily see which employees you'll need to change the Gross Up Amount for based on either the FICA limit or the Supplemental kicking in.

More "sophisticated" payroll systems allow for a gross-up automatically.  You tell the system what you want the net check to be, and whether or not Federal and State Withholding is withheld.   I asked Sage when they were re-writing the software if they would include that, but alas, no.

Sue Bennett | President

Bennett/Porter & Associates, Inc.

P. 503 620 3484 | F. 503 620 2765

12559 SW 69th Ave | Portland, OR  97223

Email address | www.benpor.com

Bennett/Porter Blog | facebook | twitter

The information in this email and any attachments is considered confidential. This information may be subject to legal, professional, or other privilege. It must not be disclosed to any person without our authority. If you are not the intended recipient you are not authorized to and must not disclose, copy, distribute, or retain this message or any part of it. Please return this message to the sender immediately and delete any and all copies from your system.

I don't know that there is a tax rule that allows you to not calculate the withholding taxes, and yet reports those wages as taxable.  I've asked for it, and maybe it is there now – but it would be fabulous if they would add that rule.

Barring us finding a rule that does work, I don't think you should do an import for FICA/Medicare because of two reasons:  1) if the employee is over or nearing the FICA limit, you might be over-withholding FICA, and 2) likewise, if they're approaching or over the $200,000 Medicare supplemental, you might be under-withholding Medicare.  I've always grossed up the amount to cover FICA/Medicare (taking into account Employees who are just under or over the FICA limit, plus those who are at or nearing the $200k Medicare supplemental), let the system calculate the taxes, and then zero'd out the two Withholding taxes.  If only part of the bonus puts them over either the FICA limit, or only part of the bonus is applicable to the $200k supplemental for Medicare, the system will calculate that correctly.  And you can easily see which employees you'll need to change the Gross Up Amount for based on either the FICA limit or the Supplemental kicking in.

More "sophisticated" payroll systems allow for a gross-up automatically.  You tell the system what you want the net check to be, and whether or not Federal and State Withholding is withheld.   I asked Sage when they were re-writing the software if they would include that, but alas, no.

Sue Bennett | President

Bennett/Porter & Associates, Inc.

P. 503 620 3484 | F. 503 620 2765

12559 SW 69th Ave | Portland, OR  97223

Email address | www.benpor.com

Bennett/Porter Blog | facebook | twitter

The information in this email and any attachments is considered confidential. This information may be subject to legal, professional, or other privilege. It must not be disclosed to any person without our authority. If you are not the intended recipient you are not authorized to and must not disclose, copy, distribute, or retain this message or any part of it. Please return this message to the sender immediately and delete any and all copies from your system.