Sample Setup for Percent of Wages Option
If you are new to Payroll, you may find it helpful to review an example of how to set up Payroll to implement the % of Wages option.
Your company's headquarters are in Massachusetts, but you have an office in Oregon. Brenda Gray spends time in both offices. You want to track her wages and withholdings based on the state where she performs her work. The
Follow Project Locale method of tracking withholdings does not work in this case because Brenda's work is not tied to a specific project. You decide to use the
% of Wages method.
To track wages and withholdings by a percentage of wages:
- On the Navigation menu, click and click the Payroll tab of the Employees hub form.
- Open the employee record for Brenda Gray.
- In the Withholdings grid, set withholdings for Massachusetts and Oregon to Active and select System as the Method, so that DPS refers to tax tables when making tax calculations.
- Set the Locale Method field to % of Wages. Both MA and ME display in the State/Local/Tax Jurisdictions grid.
- In the MA % of Wages field, enter 80 to designate that 80% of Brenda's time is spent working in Massachusetts and then enter 20 in the OR % of Wages field.
- Save the employee record. Brenda fills out her timesheet. Brenda charges 80 hours to an overhead project. DPS does not look to the timesheet to calculate withholdings when using the % of Wages method. DPS refers only to the settings established in the State/Local/Tax Jurisdictions grid of the Payroll tab in the Employees hub.
- In Payroll Processing, select payroll options for the run and make sure that Brenda Gray is selected for the run.
- Run a draft Payroll Journal. Notice how withholdings are divided between MA and OR.
- Process payroll.
- Print checks.
- Preview the check. Notice how withholdings are broken out between Massachusetts and Oregon.
- Assign check numbers.
- Post payroll.
- Run the Payroll Posting Log. Notice how withholdings are broken out between Massachusetts and Oregon.