Q&A from FFCRA and Sage HRMS webinar

I would like to thank everyone that attended FFCRA and Sage HRMS webinar on Friday April 3, 2020. A couple of items I would like to clarify for the Sage HRMS product:

- In Sage HRMS, the earning code can be set up as a flat or hourly.  The code used for the earnings does not matter.  However, the tax code (local tax code) must have the code CVIDSS and CVIDMD.  For more information on setting up these local tax codes, see the Sage Knowledgebase article 104155. 

- How to calculate 2/3 pay for COVID 19.  You can manually calculate the amount or if you have a lot of employees, do an export, modify the export file and then import it back into Payroll. 

The webinar this week (April 8th at 1:00 pm EST) will be a repeat, however we will be incorporating questions into the webinar from April 3rd webinar.  In this weeks webinar,  Mark Auchtung, the Manager of Research and Design at Sage, will be joining us for Questions and Answers. 

To register for this webinar, click here, or go to https://get.sage.com/HRMSLearningSeries and register.

The questions and answers along with the handout is for guidance purposes only and is not intended as legal advice.  We've made every effort to ensure the information is correct and up to date and recommend you do your own research and seek tax advice.

Without further ado, here is a list of Questions and Answers from April 3rd.  Thank you for your patience while we were confirming some of the answers.

Question Answer 
Max is $5110 over the two week period for this leave type. Yes, EPSLA - Max is $511 per day or $5,110 total over the entire eligible paid sick leave period.
For HRMS, according to the engineers working on the payroll programming, the tax codes are required to be CVIDSS and CVIDMD, but the earning codes can be what you want. Yes, the tax code in Sage HRMS should be the codes listed in the Sage Knowledgebase article (for Sage HRMS #104155, Suite #104144). We also suggest using these earning codes. Currently, you could have created different codes. The objective with these tax codes is to track information to be able to pass to Aattrix for reporting purposes. Once the forms are finalized, we will know more.
You should also account for any pretax deductions as well that might be taken out of the leave checks. Yes, you want to review the setup of the tax codes for any pre-tax deductions or additional taxes that may be applicable. We suggest verifying applicable federal, state or local taxes with your tax professional.
Why specific month/day? That makes it effective on 4/1 of the year the employee was hired, not 4/1/2020? In the 'Starts' field, we are not selecting date of hire or so many days after hire. Instead, we suggest Specific Month/Day. This is guideline, you could set it up differently.
Couldn't we just withhold our taxes as is and then request the entire credit back on form 7200 That is not recommended. Our suggestion is to follow the Sage Knowledgebase for setup instructions.   For any deviations from legislation, I would suggest contacting your tax advisor. However, if it was an error or mistake, you could reconcile it when doing your filing for Form 941. Again, we don't suggest taxing it first, then getting it back unless it was a mistake.
When we create these codes, it is assuming that we are not making any FICA deposits relating to these codes that are due with each payroll correct?  You would need to contact your tax advisor for details surrounding your tax deposits.
I guess we will need to adjust the 941 deposit through Aatrix to either include or not include these "local" tax amounts correct? The IRS has not released the reporting specifications for this legislation and as such we have not made any program changes for quarterly reporting.   Once this guidance is provided by the IRS, we will address it within the product. More details to come!
Would you use a pay factor of .67 for the EFMLA and Sick Leave for caring for another? Yes, you could also pay 2/3 (.667) for the expanded sick leave.   For example, if you took time off to look after someone. Depending on the reason someone is taking the leave they could get full pay or 2/3.   In the slide 1-3 would be full pay and 4-6 would be 2/3. 
Why is the calculation method set at flat, instead of 2/3 base? This is a general guideline, but yes, you could use a payrate that is 2/3. It depends on the scenario as to why you are making the payment.
I have been setting this up as hourly rate is that going to be a problem The earning codes for EPSLA can be hourly or flat amount. In the KB we provide an example of how to set it up and we used a flat rate.
This webinar covered payroll. Will Sage HRMS be able to track the leaves? We don't use Sage HRM Yes!
We don't use Sage HRMS for payroll. Can Sage HRMS track the leaves? Yes!
If my employer has more than 500 employees, does this apply? It does not apply.
Would the wages also be subject to local, FIT, and FUTA taxes? The leave pay should be taxed like any other earning you would pay with the exception being the Employer portion of Social Security. The leave pay is NOT taxable for the Employer portion of Social Security. For tax guidance beyond this you should speak with your tax advisor.
Since we are setting up new local Medicare and Social Security tax codes would we not want to use the standard USMED and USSS tax codes that have been setup under Federal/State tax codes? No. Continue using USMED and USSS for existing codes. The new FFCRA related earnings should be subject to the two new local tax codes. Please refer to the Sage Knowledgebase articles for more information.
Why is the flat amount used for the earning codes vs hourly rate? You could use either. The example given is flat amount. Hourly could also be used.
How will this actually work during the processing of payroll. We will use the earning code for the employee and hours (since there is a limit on the hours) how will that look/work during the payroll process?   We need more guidance on the specifics of how this will work in HRMS.  Add earnings and local taxes to employees on their Employee Payroll Page.   On the timecard you would pay the new earning codes when applicable. Verify correct earnings and taxes occur on the pre-check payroll register.  Each earning that is paid should be listed along with taxes.  For more specific questions and answers, please contact Sage Support.
How will we calculate the 2/3's pay for EFMLA and EPSLO? That doesn't seem to be covered in the set up? So, are we expected to do this by hand?  Answer depends on which product you are on. There are more than one way to do this. For Sage HRMS, you can do the calculation manually. If you have a lot of employees, you can do an export, modify the export file and import it back into payroll. I would suggest contacting Sage HRMS Support for a specific details on how to do this.
Any additional information you can provide on the way this will work through Aatrix will be helpful, as soon as it is known! As soon as the IRS releases the specification for reporting we will provide that guidance.
Do the earnings code have to match what is in the instructions or just the tax codes? For Sage Abra Suite and Sage HRMS it does not matter on the earning code.   For Sage HRMS the tax code must be what is in the instructions. HRMS will be using these codes to supply information for Aatrix to do their reporting.
In payroll you have to assign the codes to each employee correct? Yes. In HRMS you can globally assign taxes and assign earnings under the task.
Are these not subject to Income Tax? The leave pay should be taxed like any other earning you would pay with the exception being the Employer portion of Social Security.  The leave pay is NOT taxable for the Employer portion of Social Security.  For tax guidance beyond this you should speak with your tax advisor.
I don't understand why only add the COVID taxes and not all the other applicable state and federal taxes. Add all of the applicable taxes for that earning code. Check with your tax professional for additional information.
If you live/work in a state (TX) that doesn't require us to pay FLMA time off, are we required to pay in the COVID time EFMLA?? The best bet for this question is to head to the Government website or contact a tax professional.
So with the 3 new earnings, they are NOT subject to Federal Taxes... only the new COVID 19 SS and Medicare? The leave pay should be taxed like any other earning you would pay with the exception being the Employer portion of Social Security. The leave pay is NOT taxable for the Employer portion of Social Security. For tax guidance beyond this you should speak with your tax advisor.
During the earning code setup there was no federal unemployment withholding - can you confirm this is correct? The leave pay should be taxed like any other earning you would pay with the exception being the Employer portion of Social Security. The leave pay is NOT taxable for the Employer portion of Social Security. For tax guidance beyond this you should speak with your tax advisor.
Any help on setting up the G/L code for the taxes? Check with your accountant to see what G/L accounts they would like this posted to.
Where do you enter the 2/3 factor in HRMS? HRMS - Depending on the setup, you could use employee configuration to link the employees payrate to new earning code with a conversion factor of .667. You could also manually enter the payrate at the employee level. For people on Sage Abra Suite you could use a secondary job with a different pay rate or set up a shift premium. It depends on your situation. For more information, I would suggest contacting Sage HRMS support.
Do these new tax codes apply to govt employers who are not allowed to take the tax credit? Best bet on questions like this is to either navigate to the Government website or check with a tax professional.
Are you adding the 7200 form in Sage? Aatrix will be supporting this form.
For a nonprofit, do you know how unemployment will work. For tax guidance please speak with your tax advisor.
Will you go over the set up in Sage 300 in the payroll module as well? No, but the setup in Sage 300 Payroll is similar to Sage HRMS.   Please refer to their knowledgebase article.
If we are going to be switching over to Sage HRMS should we use EFMLA and the other two codes to set up in Sage Abra Suite? The instructions for Sage Abra Suite earnings does not matter what code is used. For Sage Abra Suite, you want to modify EMP1. For Sage HRMS there needs to be two local tax codes set up. I would suggest talking to your implementer to see how they will be handling this.
Still curious as to why two of the earning codes were set up as flat amounts rather than mapped at a .667 rate factor x pay rate. Depending on why the employee is taking the leave, it could be at full rate or 2/3 using the pay rate. 
Does leave apply to employees that are out waiting on test results of COVID 19? That is a great question. I would recommend contacting your tax professional. For non-confirmed cases, employees are required to quarantine.   If the employer doesn't provide an option to work from home, and employee is out of work and need to take the leave. Your question is different, so again, I would direct you to a tax professional.
Will COVID19 accumulate wages on employer Medicare? The leave pay should be taxed like any other earning you would pay with the exception being the Employer portion of Social Security. The leave pay is NOT taxable for the Employer portion of Social Security. For tax guidance beyond this you should speak with your tax advisor.
Why is Abra Suite Medicare is not set up but HRMS is set up? Sage HRMS partners with Aatrix. HRMS is gathering the information in case it is needed. The reporting requirements for the Form 941 have not been finalized at this time.
Does the earning code matter if we already set up a different code? The earning code does not matter. The tax code must be the same for Aatrix to recognize it.
Wouldn't you need to add Federal income taxes and State taxes? The leave pay should be taxed like any other earning you would pay with the exception being the Employer portion of Social Security. The leave pay is NOT taxable for the Employer portion of Social Security. For tax guidance beyond this you should speak with your tax advisor.
How do Product Messages get populated on the home page in HRMS? I do not see any messages You need internet connection and make sure you have not opted out under User Preferences. If issue still occurs, please contact Sage Support.
Is there anywhere in the set up which would automatically reflect the 100% of pay for EPSLA versus 66.6% for the other two categories? Our suggestion for the 2/3 pay is to do the calculation manually at the employee level. If you have lots of employees, you can do an export, modify the export file and import it back into payroll. You can also take a look at employee configuration and link the new code to the earning code and use conversion factor of .667. This would depend on how the earning is set up. Please contact Support for any additional questions.
In Abra, since these payments are deducted from the Federal tax payments, do I need to subtract the payment manually or are the reports going to reflect the subtraction of the earning for calculating the amount due? If you are referring to reporting of this information the IRS has not released these details. As soon as the IRS releases the specification for reporting we will provide that guidance.
Why is EPSLO and EPSLA setup as Employee Calc. Method Flat. We have over 40 employees that we need to calculate we would like HRMS to do this for us. It can be hourly or flat. 
We are especially concerned with making sure we pay correctly for such as someone making 8 dollars an hours for he two thirds that is less than minimum wage so we need it to calculate with a minimum. Also employees making more than say 20 to 25 dollars an hour there is a hard stop because of the maximum You would need to speak with your Tax Advisor regarding minimum wages.   Once the amount being paid is known, you can manually enter the amount.
  • I would like to know if HRMS will be doing something so that COVIDSS and COVIDMD will be combined with USSS and USMED by employee to track 2020 wage base limits? Say if I have an employee that is close to meeting USSS limit for the year, will COVIDSS continue to accrue toward this limit for the employee?

  • For Sage HRMS product there will be a hotfix to recognize the cap for Social Security between the two taxes.  This is scheduled to be released this week.  Keep an eye out for a post on Sage City and an in product message.  For any additional questions, I would suggest reaching out to Sage HRMS support.

  • I have created the earnings and tax codes per the webinar.  I ran my first payroll today and now I am trying to make the tax deposits.  When I go to Reports > Payroll > Government Reports and Select Federal Tax Deposit EFTPS I am taken through the Company Setup Wizard and being required to choose a State for COVIDMED & COVIDSS.  I am not able to find any documentation that clarifies what to do here.  I assume I should enter our home state, however, assumptions usually cause problems in the payroll world.  Please advise on how to proceed?

  • I've confirmed with Aatrix that the recommendation is to map these items to a state, one you will not be processing your normal payroll through so you can get through the screen and to the point of filling and eFiling the form.

  • I did as you suggested and used a state we are not processing through to get through the screens.  But it is not picking those amounts up on the 941 tax deposit.  Are these taxes paid separately on another form and at another time?