Local tax gross

[prodata]

How can I set up the Local tax so that it calculates based on a percentage of Federal gross pay? I can make the tax amount correct by adjusting the percentage, but then the Local gross on the W2 is wrong.
Can I change the Local gross amount on the W2?

[Paul Mayer]

See the Tutorial titled "How to Create Local Tax Records and Use Them" at http://zpay.com/help as the example shows you how to set it up for a percentage on the gross wages which is the norm in most local taxes.

If the wages are different on the W2 form, you must have some deductions that are non-taxable that would cause a variance in wages for federal and or local taxable wages.

[prodata]

The local wages are different because they are based on the time spent in the local tax area. For example, in a 40 hour week, only 24 hours may be spent in the local area and therefore taxable.
Is there any way to indicate a different gross for federal and for local?

[Paul Mayer]

No there is no way to denote a different gross for a portion of the time worked, just for all time worked. I've never even seen a payroll that can handle something like that.

The only way you could do that is to set up your employees as hourly and as multiple department payees with one department being the time in the "local area". Then taking that departments gross wage manually calculate and enter the local tax by hand before saving the transaction.

But the biggest problem would be tracking that and manually creating W2 forms.

[prodata]

I can arrive at the right tax amount by converting the tax percentage rate to reflect the portion of gross; for example, change a tax rate of 3.7242% to 2.2345% if the portion of time was 60%.
The remaining problem is the W2 and W3 forms. Are you planning to add an otion to edit those forms?

[Paul Mayer]

Yes we will have the ability to edit W2 Forms at the end of this year.

[prodata]

Paul,
THANK YOU. That will be very helpful.
I really appreciate your prompt responses.
David