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This article applies to:

  • Product: Accounting CS
  • Subject: Payroll checks,Setup

Adjust taxable wages for employees

The application provides a number of ways to manually adjust taxable wage amounts and gross taxable wage amounts for employees. This might be necessary to make corrections to the taxable wage information on payroll checks due to an error in tax treatment, for example, or to reduce taxable wage amounts if retirement plan contributions for an employee are paid outside of the payroll process.
note
  • "Taxable wage amount" refers to the employee's gross wages minus any pre-tax deductions with the taxable wage limit applied. "Gross taxable wage amount" refers to the employee's gross wages minus any pre-tax deductions with the taxable wage limit
    not
     applied.
  • The adjustments that you make will affect the amounts displayed on payroll reports and any payroll tax forms that include taxable wage amounts, including Forms W-2 and 1099. The adjustments
    don't
     affect gross or net pay amounts.
  • To make year-end taxable wage adjustments, use the Adjust Taxable Wages dialog.
  • To make taxable wage adjustments throughout the year, you can do any of the following.
    • Make changes directly to printed payroll checks or handwritten checks that have generated liabilities.
    • Change the wage exempt status for particular clients or employees.
    • Change the tax exemptions for a client's payroll items.
    • SUTA wages must be adjusted using one of the three methods listed above. Year-end taxable wage adjustments don't include SUTA taxable wages.

Make year-end taxable wage adjustments

  1. Choose
    Setup
     then
    Employees
    .
  2. Select the employee whose taxable wage amounts are to be adjusted, then select
    Edit
    .
  3. Select the
    Payroll Taxes
     tab.
  4. Select
    Adjust taxable wages
    .
  5. In the
    Adjust Taxable Wages
     screen, use the Data range options to choose whether to include data based on payroll transactions from the current year or prior year for the employee. By default, the Current year option is chosen.
  6. In the
    Taxes
     column, select the ellipsis button to open the
    Adjust Taxable Wages - Tax Selection
     window, where you can select the taxes that are to be adjusted for this employee. The taxes and related wages and adjustments that you select here will be listed in the Tax Balances section of the Adjust Taxable Wages window.
  7. When you have selected the appropriate taxes to adjust, select
    Done
     to return to the
    Adjust Taxable Wages
     window.
  8. In the
    Gross Taxable Wages Adj.
     and the
    Taxable Wages Adj.
     columns, specify any adjustment amounts. The adjustment can be either positive or negative.
  9. Use the
    Notes
     field to enter any notes regarding this adjustment.
  10. Select
    OK
     when you've entered all the necessary adjustments.
note
If you need to delete any of the adjustments you have added, highlight the row and then select the
Delete
 button.

Make adjustments to payroll checks

  1. Choose
    Actions
     then
    Enter Transactions
    .
  2. In the Transaction list, highlight the payroll check for which you want to adjust taxable wage amounts, then select
    Edit
     then
    Adjust Taxable Wages
    .
    note
    You can adjust wages only for printed payroll checks or for handwritten checks that have liabilities generated for them. Information in the
    Adjust Taxable Wages
     window can't be modified for any other types of payroll checks.
  3. In the
    Adjust Taxable Wages
     window, use the Tax Balance grid to make the necessary adjustments for the payroll check.
  4. Select the ellipsis button in the
    Notes
     column to enter any notes regarding this adjustment.
  5. Select
    OK
     to save the adjustment information.

Change the wage exempt status for clients or employees

Changing the wage exempt status for specific taxes for clients or employees enables you to update taxable wages for all payroll checks entered after the change and to adjust the taxable wages from existing payroll checks. Note that this may affect previously filed payroll tax forms.
  1. Select
    Setup
    ,
    Clients
     or
    Setup
    , then
    Employees
     and select the
    Payroll Taxes
     tab.
  2. Highlight the client or employee and select the
    Edit
     button.
  3. In the Taxes section, mark the
    Wage Exempt
     checkbox for any taxes for which you want to make the client or employee exempt.
  4. Select the
    Enter
     button to save the changes to the client or employee record. The application displays a dialog to inform you that the wage exempt status changes will affect the taxable wage amounts for all payroll checks that are entered for this client or employee after this change.
  5. If you want the taxable wage amounts for prior payroll checks to reflect the change also, specify an effective date then select
    OK
    .
note
Payroll checks aren't recalculated and no amounts on the checks are changed.
The changes you make to the taxable wage amounts for existing payroll checks may affect previously filed tax forms.

Change the tax exempt status of payroll items

Changing the tax exempt status for specific taxes for payroll items enables you to update taxable wages for all payroll checks entered after the change and to adjust the taxable wages from existing payroll checks. Note that this may affect previously filed payroll tax forms.
  1. Choose
    Setup
    ,
    Payroll Items
    , then the
    Tax Exemptions
     tab.
  2. Select the appropriate client record from the
    Client
     field in the top right-hand corner of the screen.
  3. Highlight the payroll item in the Payroll Items list then select
    Edit
    .
  4. Mark the checkbox for any tax for which you want to make the payroll item exempt.
  5. Select
    Enter
     to save the changes to the payroll item. The application displays a screen to inform you that the tax exemption status changes will affect the taxable wage amounts for all payroll checks that are entered for this client after this change.
  6. If you want the taxable wage amounts for prior payroll checks to reflect the change also, specify an effective date then select
    OK
    .
note
Payroll checks aren't recalculated and no amounts on the checks are changed.
The changes you make to the taxable wage amounts for existing payroll checks may affect previously filed tax forms.