Dynamics Community Forum Thread Details

How to correct state Tax.

All,

We have ran first payroll for 2012 and one of employee which is in Florida her State Tax is not applied because of user mistake.

Now we want to correct it how can I correct it? As per KB929600

Click Transactions, point to Payroll, and then click Manual Checks.
In the Payroll Manual Check-Adjustment Entry window, leave the Batch ID field blank. In the Checkbook ID field, type the checkbook ID, and then type the check number in the Check Number field.
In the Check Date field, type a date. This date is used to update month-to-date and year-to-date fields throughout the Payroll module.
In the Posted Date field, type a date. This date is used to update the General Ledger module.
Type the Employee ID in the Employee ID field.
Click Transactions.
In the Transaction Type list, click State Tax.
In the Code list, click the appropriate state tax code.
In the Amount box, type the state taxes -This will add Tax for last pay period of 2012
Close the window.
Click Save when you are prompted to save changes to this transaction.
Click Post. When you are prompted to print reports, select a destination, and then close the Payroll Manual Check-Adjustment Entry window.
Repeat step 1 through step 13 for each employee that you want to adjust.

But Do we need to reduce those amount from Next Payroll? If I pass above Manuall Entry how in Next Payroll it will get affect? Or How to process ACH file for Manual Check?

Any response is highly appreciable.

Thanks

Sandip

Hi Sandip,

My name is Terry and I can assist you today.

Manual check window is just used to make an adjustment to the payroll system. It does not actually cut a check and it would not do anything in the next payroll, it just adjust amounts. Interesting the employee is in FL. FL has no state tax, so do we just need to pay the employee back the money that was incorrectly taken from the other state?

If that is correct you can still use the KB you were looking at 929600 and do this part to pay the employee back.

How to reimburse an employee for taxes that were incorrectly deducted

1. Click Tools, point to Setup, point to Payroll, and then click Pay Code.

2. In the Pay Code Setup window, set up a new expense account pay code. In the Description field, type a description, and then click Business Expense in the Pay Type list. Make sure that the Report as Wages check box is not selected, and then click Save.

3. Click Cards, point to Payroll, and then click Pay Code.

4. Assign this new pay code to the employees that you want to reimburse.

5. In the Pay Rate box, type the total federal and state taxes that you want to reimburse to the employee.

6. Click Save.

7. Click Transactions, point to Payroll, and then click Transaction Entry.

8. In the Batch ID field, enter a batch ID.

9. Enter a transaction for each employee that you want to reimburse.

10. In the Code list, click the expense account pay code that you created in step 2. By default, the amount that appears in the Amount field is the amount that you typed in step 5.

11. Process the payroll batch that you created in step 8, and then click Post.

Then follow these steps under this area of the KB to adjust the state tax down so it will show zero.

How to create a transaction that decreases the state tax withheld and the state taxable wages

Hope this helps, thanks

Terry

Partner Online Technical Community

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