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Dynamics 365 Community / Forums / Microsoft Dynamics GP (Archived) / FICA not pulling from ...
Microsoft Dynamics GP (Archived)

FICA not pulling from payroll check

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We have a couple examples where employees are showing a negative Net Pay on their pay stubs. It appears to be due to GP not pulling out FICA taxes. Example 1, employee had Gross Pay of $94.14. His deductions were split between a Greenshades Garnishments (CHILD1) and Healthcare deduction, both deducting $47.07 which totals $94.14. This doesn't leave any pay leftover for FICA and thus creates a Uncollected FICA Medicare Tax line on the Precheck report. We processed over 2,300 checks in this pay run yet this is the only one that is showing a negative Net Pay. What could possibly be causing this?

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  • Suggested answer
    L Vail Profile Picture
    L Vail 65,271 on at

    In the Earnings Setup for the garnishment, be sure to check the bottom of the Earnings Setup window and make sure the FICA tax checkbox is checked. Do you also have the Garnishment Maximum Setup window completed? There is typically a limit on how much a garnishment can take out of Net Earnings. Net Earnings is typically after all taxes have been deducted. It looks like the limit is set to 50%, which is normal, but it's not normal that FICA has not been deducted in the calculation of Net Earnings.

    What do you find?

    Kind regards,

    Leslie

  • Community Member Profile Picture
    Community Member on at

    Leslie,

    Thank you for your reply. I did verify the FICA tax box was checked in the Earnings Setup. I also set the Pay Period maximum deduction in the Employee Deduction Maintenance window and am still getting the same results. I even tried to remove the CHILD1 garnishment from Build and still get uncollected FICA. I should also mention that we have several employees in this same payroll that should have had $0 pay and they accounted for FICA correctly so in my mind this is definitely a setup issue. Just not sure what.

  • L Vail Profile Picture
    L Vail 65,271 on at

    Ok,

    Let's investigate. First, does this guy have 'competing' garnishments? I'll go on presuming the answer is 'no'. I've never used the Greenshades garnishment module, but if it's like the others, it relies on the GP setup to work its magic.

    1 - Determine the correct definition for 'Earnings' according to the garnishing (is that a word?) authority. As you've already noted, the Taxes are checkboxes along the bottom. Set this up in the Earnings Setup window.

    2- Set up the Garnishment Maximum. What is the Max withholding percent. This will probably be a percentage of 'earnings' as defined above.

    3- Setup the Garnishment Deduction and indicate the Maximum Deduction  Code in the lower-left quadrant of the Employee Deduction Maintenance window. Make sure the Deduction Type is Garnishment.

    It sounds like you've done all of this. You mentioned that when you removed the garnishment from the build, you still get uncollected FICA. This would cause me to think it's not a problem with your garnishment setup. Does it calculate FICA correctly, but just doesn't withhold it?

    Does this guy make enough money to satisfy his Federal Income Tax withholding? He could have extra withholding marked and doesn't make enough money to cover both. If you run it without the garnishment, what are his gross income numbers less the other deductions?

    Does this employee receive tips? That's when I usually see Uncollected FICA.

    Have you run reconcile or check links on the payroll module?

    I know the answer is staring us in the face. It's times like this that I want to do a mind-meld with Terry Heley.

    Kind regards,

    Leslie

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