Dundee Group Blog

Proper Setup of the Tax Withholdings Panel in Sage Abra Payroll

How do you setup an employee to have no Federal Income Tax or State Income Tax withheld? Can you set an employee to have a flat amount withheld in each check? In this post we'll examine how to do this. Abra has two settings in the exemption count field which can assist with this.

If you want Abra Payroll to accumulate wages for the employee, but not withhold any taxes, enter 99 in this field and select No in the Exempt field. (This is a special code you should use only for this situation.)

If you want Abra Payroll to accumulate wages for the employee and only withhold supplemental taxes enter 98 in this field and select No in the Exempt Field. (This is a special code you should use only for this situation.)

You can also combine the Extra Tax field to give you flat amounts.

Example: an employee needs to have $600 per pay period withheld. First set their exemptions to 98 or 99 as noted above. Next, enter 600 in the Extra Amount field. Select 'Absolute' for Extra Tax Type field. The 98/99 setting will ignore the tax table and withhold $0. The extra amount is added, $0+$600, and $600 will be withheld each pay period.

If you are pay a Bonus Earning taxed at Supplemental Tax Rates you will probably want to use 98 exemptions.

Example: An employee is setup to have $200 per pay period withheld. They are also receiving a $500 bonus earning this period. Your bonus earning is set to use the Supplemental Tax Rates.

If the employee is set at 99 exemptions, their regular check will have $200 Federal Income Tax withheld. Their bonus check will have $0, since the $200 amount was withheld in the first check.

If the employee is set at 98 exemptions, their regular check will have $200 Federal Income Tax withheld. Their bonus check will have $125 Federal Income Tax withheld ($500 * 25% Supplemental Federal Tax Rate).

Disclaimer: the purpose of this post is to educate you on how Sage Abra Payroll works. We are not giving tax advice. Please consult a tax professional if you have questions on what is allowed by State and Federal law.

Posted by: Tim Ross

Importing Hours into Sage Abra Payroll with Time & Attendance Software

Dundee Group's customers have a number of different Time & Attendance solutions that they use with their Sage Abra Payroll systems. Some they love and some not so much. Some systems have been built from the ground up to work with Abra and others are designed to work with a variety of payroll systems.

Without an automated Time & Attendance system, payroll staff key hours into Abra using 'Create Auto Time Sheet' or 'Enter/Update Time Sheet'. Both of these processes put records in the table PrPost. The goal of a Time & Attendance system is put those records in automatically with a Payroll Import. These hours are visible in the 'Time Sheet' tab when you run 'Edit/Update Time Sheet' for your payrgroup.

If your system has table-to-table integration with Abra, then it will write your hours directly to the PrPost table. Typically your Time & Attendance software has a process that you will run to write the records directly to Abra. Since the records are added outside of the Abra User Interface, you will need to Reform Indexes when you log into Abra to see your hours in Abra. (If you don't see any hours on the 'Time Sheet' tab you've forgotten this step!)

Other systems will create an import file which can be brought into Abra using an interface which converts the text file into FoxPro records. In this case the process is to 1) create the export file in the Time & Attendance software and then 2) convert and import the hours with your interface. An interface written to run inside of Abra will do your reindexing for you.

Some earnings are paid in dollars rather than hours such as stipends or bonuses. These earnings are visible in Abra on the 'Other Earnings' tab of 'Edit/Update Time Sheet'. If you plan to track these in your Time & Attendance system then you will need to have it update the table PrEarn. If the earning doesn't exist on the employees Earnings panel your interface should create it.

If you don't have an automated Time & Attendance system, we suggest you contact us to learn how Time & Attendance systems can improve your bottom line. If you have an existing Time & Attendance system, Dundee Group can write an interface for Sage Abra Payroll.

Posted by: Tim Ross

No Schedule B On Your 941?

When you run a Trial Quarter Close you can run the Pre-Close 941 report to check your numbers. This report offers the option to print the Schedule B on the specific criteria panel. Once you complete your Final Quarter Close, you are ready to run the Form 941. There is no option to print the Schedule B. How do you get Abra to print this?

You need to tell Abra what kind of depositor you are.

1. From the Activity Center, select Payroll, Processes and Edit Quarter/Year-End Forms
2. Select the Employer, Year, 941 Form, select the correct Quarter, and select OK
3. Select the tab labeled 'Lines 11-17' and choose Semiweekly depositor
4. Select OK

Your Schedule B will now print.

Posted by: Tim Ross

New New York Payroll Tax

A new payroll tax was signed into law by Governor Patterson called the Metropolitan Commuter Transportation Mobility Tax (MTA Payroll Tax).

The Metropolitan Commuter Transportation Mobility Tax (MCTMT) is a new tax imposed on certain employers and self-employed individuals engaging in business within the Metropolitan Commuter Transportation District (MCTD). The Department of Taxation and Finance administers the tax for the Metropolitan Transit Authority.

The MCTD includes New York (Manhattan), Bronx, Kings (Brooklyn), Queens, Richmond (Staten Island) , Rockland, Nassau, Suffolk, Orange, Putnam, Dutchess, and Westchester counties.

The Tax applies to:

• Employers required to withhold New York State income tax from employee wages and whose payroll expense exceeds $2,500 in any calendar quarter

• Individuals with net earnings from self-employment allocated to the MCTD that exceed $10,000 for the tax year. (This includes partners in partnerships and members of an LLC treated as a partnership.)

The Tax rate is:

• Employers: .34% of an employer's total payroll expense for employees employed within the MCTD

• Individuals: .34% of net earnings from self-employment allocated to the MCTD during the tax year

Posted by: Tim Ross

Quarterly Updates Available Today - ARRA 2009

The First Quarter 2009 updates for Sage Abra Suite are available today. Version 7.67 and Version 7.73 can be downloaded by Payroll customers from the Sage Abra Support site. The versions address the changes mandated by the American Recovery and Reinvestment Act (ARRA) 2009 including:

• The updated percentage method withholding tables have been implemented.
• The earned income credit percentage increase in 2009 and 2010 to 45% of the family's first $12,750 of earned income for families with three or more children.
• The additional annual wage amount when calculating the withholding for nonresident aliens increased to $7,180.

Please remember to backup your Abra system using your external backup procedure before installing your update. Updates should be installed prior to running your Trial Quarter Close process for First Quarter 2009.

Posted by Tim Ross

Setting up an IRS Levy in Sage Abra Payroll

It's a sad but true fact that eventually you're going to have an employee with an IRS Levy. How do we handle this in Abra? Here's how:

From the Activity Center, select Payroll, Rules and Tax Codes. Add a LEVY Tax Code, making sure the Tax Code and the Tax Table ID say LEVY. On the Taxable Earnings tab, be sure to select all applicable Earnings Codes. 

From the Activity Center, select Payroll, Rules and Deduction Codes. Add a LEVY Deduction Code. The Calculation Rule must be 'Flat Amount' and the Deduction Type must be 'Federal Levy'. Also make sure that there is an Earnings Basis for the deduction. 

From the Activity Center, select Payroll, Details and Tax Withholdings. Add the Levy Tax Code to the same employee and be sure to complete any other needed items for the Tax Code (Exemptions, etc...).

The following table is used for the Filing Status for the Levy Tax Code.

Single - Single
Married Filing Joint Return (and Qualifying Widowers) - Married
Unmarried Head of Household - Head of Household
Married Filing Separate Return - Other

The Federal Levy is calculated by Abra based on Publication 1494 from the IRS. This publication may be obtained from the IRS here. The Levy amount is calculated internally and the correct amount will be withheld from the employee's check as a deduction which can then be paid to the IRS.

NOTE: Any earning that is set up as a Tax Only, Not in Check will not be included in the check amount after the Levy. For Example, an employee claiming Married and 2 exemptions should have 719.23 biweekly exempt from Levy (based on the 2009 tables). However, if they have a tax only, not in check earning of 150.00, it will show a net check of 569.23.

If it is necessary to withhold a specific flat amount for the Federal Levy, set up a new deduction code with a Deduction Type of Regular Withholding After Taxes and a Calculation Rule of Flat Amount. Add the new deduction code to the employee's Deduction panel and specify the correct amount there.

Posted by: Tim Ross

Sage Abra Year-End Payroll Classes

Before you know it, year-end will be here. Be sure to attend one of these classes to prepare.

Topics covered include:

Preparing for Year-End Closing
Defining Forms
Reporting Special Earnings and Withholdings in Abra Payroll
Pre-Final Processing 2008
Year-End Balancing and Reconciling
Final Closing
Printing and Editing Year-End Forms
Electronic Filing

Please contact us with any questions or to register for one of the following one day classes.

Herndon, VA
Thursday, November 6th or Friday, November 7th

Boston, MA
Thursday, November 13th or Friday, November 14th

St. Petersburg, FL
Thursday, November 20th or Friday, November 21st

Columbus, OH
Thursday, December 4th or Friday, December 5th

Seattle, WA
Thursday, December 11th or Friday, December 12th

Scottsdale, AZ
Thursday, December 18th or Friday, December 19th

Posted by: Tim Ross

Upcoming Sage Webinar on Sarbanes-Oxley

Be sure to save this date and time: September 3, 2008 at 2PM Eastern

You won't want to miss this information packed session on Sarbanes-Oxley which is part of the Sage Software Lattes-Lunch-n-Learn series. The session is entitled:

"Sarbanes-Oxley and Its Impact on Payroll Controls"

Attend this free, educational Webcast, presented in partnership with the American Payroll Association (APA), and learn the new payroll compliance requirements. Complete the survey at the end of the Webcast to receive a free Starbucks Card loaded with $5.

Be prepared for your next audit and by understanding the new requirements and criteria that your external auditors will use to examine your payroll internal controls. This session will help you determine if you have the appropriate controls in place to meet the Sarbanes-Oxley Act's compliance requirements.

We'll follow up with more details in a few weeks.

Withholding Priorities in Sage Abra Payroll

When creating a new deduction or troubleshooting an existing one, the withholding priorities are critical. Withholding Priority indicates the order in which Abra withholds this deduction from the employee's pay. The higher the number, the lower the priority. Remember that taxes come out first and all deductions should come after the number of taxes (Federal and State) you have. So if you have 20 tax codes you need to start with 21 for your deductions and move up from there by importance. Typical I put Garnishments in next and then medical/dental etc.

On the Employee Detail of Tax Withholdings click the "Withholding Priorities" button to see what order all withholdings will be coming out.

If you decide to change the withholding priority in the rules it will not update this information on the employee level. After changing the rule, you will need to do a mass update. Look at the screen shots below to see how to do the Mass Update.

Posted by: Julie Brown

Sage Payroll PayCards reduce payroll costs associated with paper paychecks

Announced at Sage Summit 2007, Sage Payroll PayCards are an employee payment option for small and mid-sized businesses and organizations. Sage Payroll PayCards can help reduce payroll costs and the liabilities associated with paper paycheck generation, while enabling employers to give their employees a new, simple, and cost-effective way to receive their pay.

I was surprised to learn that according to the American Payroll Association (APA) as much as 25% of the U.S. working population doesn't have a bank account. Sage Payroll PayCards offer the convenience and security of a debit card, while offering a low cost alternative to paper checks. Employees without bank accounts save money by eliminating check cashing fees and fees for money orders. Easy to carry and use, the Sage Payroll PayCard is accepted nearly everywhere debit cards are accepted. Employees can access their paycheck and receive account balances 24/7, either online or by calling a toll-free number with multi-language capabilities.

Direct Deposit is always more convenient for my customers than dealing with check printing. Now with Sage Payroll PayCards, there is another option for your check only employees. It reduces the costs of printing checks and eliminates lost/stolen check stop payment fees.

Companies with Sage Abra HRMS payroll or Sage Payroll Service should definitely considered Sage Payroll PayCards for their employees.

Posted by: Tim Ross