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FICA/Medicare stopped on one of my employees this week. Medicare doesn’t have a limit. Do you have any ideas why that would happen?
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This sounds like an issue I've seen where the proper code updates have not been run for the current year and/or the most current Payroll Tax Tables were not being used.
I would go onto CustomerSource and check your version of GP versus those that are Supported, then against the Service Packs offered for download. I would suggest the March 2013 hotfix which resolves some 941 issues we were seeing and contains the 2012 Year-End Payroll Update files as well.
Next, use Automatic Tax Updates and make sure you're on the most current round of Payroll Tax Tables as well.
Once your code base has been updated properly and the correct Tax Tables loaded, instead of taxes stopping at the limit, you should see the new tax rate for wages over that number come into play.
I recommend testing this in a test company with a copy of live data to ensure that you receive the results you are looking for:
KB 871973 - Set up a test company that has a copy of live company data by using SQL Server 7.0, SQL Server 2000, SQL Server 2005, or SQL Server 2008
mbs.microsoft.com/.../KBDisplay.aspx
NOTE: Please make sure that you have a restorable backup prior to performing any troubleshooting steps.
Hi,
Jonathan, of course, has the most complete answer, but I have seen one other situation where Medicare stopped. My client actually edited the tax table and put in a different 'maximum'. So, taxes stopped being withheld. They were trying to edit the FICA limit because they could not get tax updates, and edited the Medicare limit to by mistake.
It's a long shot, but it's happened.
Kind regards,
Leslie
I updated our QA environment’s tax tables and verified the FICAM deduction and they look the same.
Here is our production environment:
Here is our QA environment (after Payroll Tax Update):
It looks like the system is ignoring the 2nd line. Do you think applying the Tax Update to our production environment will really make this work?
Or do you think it is a setup issue on the employee?
SInce you say that it is only happening to one employee then I would check this employees pay codes in Employee Pay Code Maintenance. Make sure that all of the Pay Codes(for this employee) that should be subject to SS/Med are properly enabled for SS/Med (FICA boxes checked). Seams like a long shot but worth checking...
Terry Blaser
terry@dynbuilders.com
I agree Terry,
It's easy to miss all of those boxes you need to check :)
Customer said "I believe the only reason it is happening to 1 employee is because they are the only ones that have exceeded the 200k cap.
I verified the employees pay codes and all the Subject To Taxes boxes are checked off. We have updated the tax tables and will be processing that employee again to see if it is resolved. I’ll keep you posted to the results."
One last comment. Please make sure you follow Jonathan’s advice on the Mar hotfix. It specifically addresses issues with employees who have made more the $200k in Q1. This only address the 941 report, it has nothing to do with check calculations but it seems like it would still be important.
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