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Dynamics 365 Community / Forums / Microsoft Dynamics GP (Archived) / How are uncollected FI...
Microsoft Dynamics GP (Archived)

How are uncollected FICA SS & Medicare Taxes collected?

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Posted on by Tina Haerr 432

Client needs to issues a $0 check and wants to include benefits so they are reported correctly for W2 purposes.  Some of the benefits are taxable which causes FICA SS & Medicare taxes to be calculated as uncollected. 

How are uncollected FICA SS & Medicare taxes collected in GP when the employee starts getting a paycheck again?

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  • Suggested answer
    Chris.Hadden Profile Picture
    Chris.Hadden 726 on at
    RE: How are uncollected FICA SS & Medicare Taxes collected?

    Tina, everything that I have found points me to believe that these uncollected taxes are stored in GP as liabilities and are automatically withheld on the employee's next paycheck. That is, assuming their next pay run is in the same calendar year. If in a different calendar year I would think the logic would be different.

    I have not personally tested this yet however, so you may want to consider running a test pay run in a test company to ensure the taxes are collected.

    If you do run the test, I hope you'll consider updating this post so we will all know for our future reference.

    Good luck!

  • Suggested answer
    Thomas Franz Profile Picture
    Thomas Franz 1,105 on at
    RE: How are uncollected FICA SS & Medicare Taxes collected?

    Uncollected FICA and SS taxes are paid to the IRS by the employee when they file their annual personal tax return. Generally, this only applies to tipped employees where their reported tips far exceed their hourly wages and thus, there is insufficient dollars in the check to cover the FICA taxes. If your client wants to pick up the uncollected tax amount from the employee in a subsequent pay run, I would suggest creating an arrears transaction via a deduction code as it will not pick up these uncollected taxes automatically. You can use a manual check to move the uncollected tax amounts to the deduction code for which you are creating the arrears transaction. Hope this helps.

  • Sherlene Sorenson Profile Picture
    Sherlene Sorenson 967 on at
    RE: How are uncollected FICA SS & Medicare Taxes collected?

    Hi, Tom is correct - GP does not automatically do "make up" tax deductions on future checks for uncollected taxes. The employee would pay them with their tax return.

  • Chris.Hadden Profile Picture
    Chris.Hadden 726 on at
    RE: How are uncollected FICA SS & Medicare Taxes collected?

    Thanks, Tom and Sherlene. Glad to have a final answer on this. This is what makes the GP community so great, being able to help each other.

  • Tina Haerr Profile Picture
    Tina Haerr 432 on at
    RE: How are uncollected FICA SS & Medicare Taxes collected?

    Thanks everyone for responding!

  • WendyKennedy Profile Picture
    WendyKennedy 25 on at
    RE: How are uncollected FICA SS & Medicare Taxes collected?

    Tom,

    I know this post was a while ago but, this happened to us but not on purpose.  What happens to the taxable wages when this happens?  Do you know?  Are they included in Federal, SS or Med wages?

    Thanks,

    Wendy

  • Suggested answer
    Thomas Franz Profile Picture
    Thomas Franz 1,105 on at
    RE: How are uncollected FICA SS & Medicare Taxes collected?

    Hi Wendy,

    The wages are included in Box 1, 3 & 5 of the W-2. Uncollected SS/Med tax is included in Box 12 of the W-2 (Code A for SS and Code B for Med tax). Hope this helps!

  • quattr0 Profile Picture
    quattr0 185 on at
    RE: How are uncollected FICA SS & Medicare Taxes collected?

    I just did exactly these steps manual checks, uncollected FICA Soc Sec Tax and Medicare Tax. They do indeed show up under Box 12, code A and B.

    Thanks.

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