2018 Payroll Tax Calc seems incorrect for State Withholding

I've taken our first customer who uses payroll to Sage 100 2018.  Ran the first payroll and the California State Withholding seems to be quite a bit higher when compared to the last payroll they did on Sage 100 2017 with the 2017 Q3 tax tables installed.

Every employee's withholding is higher between version.

To make testing as simple as possible I've got an employee with no deductions.  Just a salaried employee with 2 dependent exemptions, no tax overrides or anything unusual setup in the employee maint.  Employee earns $3000 on a biweekly pay cycle.  On the 2017 version withholding tax calculates at $82.27.  On the 2018 version it calculates $92.75.

I've manually calculated the amount and it really should be $82.27.  The problem with the 2018 version of Sage 100 is that Aatrix provides the tax calculation.  I don't know how to see the tax tables Aatrix is using.

I've contacted support and I'm waiting to hear back from second tiered support.

I'm curious if anyone else has noticed the same issues between versions? 

Bryce

  • What is the Filing Status that is assigned for this employee for CA in both 2017 and 2018 systems?  Internal testing that is being done shows that both the 82.27 and 92.75 amounts can be returned in 2017 depending on the Filing Status that is selected for the employee.

    Note: The new tax calculation engine introduced in the new payroll module does not use Aatrix.

  • Submitting response from Linda Weber:

    I have reviewed the CA DE4 and the California Withholding Schedules for 2018. From what I can tell, it is a matter of entering the Exemptions into either the Personal or Dependent Exemption fields.  In legacy, the Personal Exemption field is used for the 'People' exemptions such as yourself, spouse and other dependents; and the Dependent Exemption field is used for the estimated additional deductions. In this case, I believe legacy payroll was setup using the Filing Status=M with Personal Exemptions=0 and Dependent Exemptions=2. The M Filing Status should only be used for those claiming 2 or more Personal Exemptions. If in legacy, use the M Filing Status and change Personal Exemptions=2 and Dependent Exemptions=0 and then run tax calculation, this should be the same tax amount calculated in Payroll 2018 when Personal Exemptions=2 and Dependent Exemptions=0.

  • in reply to Steve Passmore

    Thanks Steve.  I tried your test between the 2018 and the 2017 version.  If I move the employees 2 exemptions out of Dependent and into Personal Exemptions I do in fact get the same result, $79.73, between versions for the California Withholding tax.  Though that's a different amount from either $82.27 or $92.75 at least it's consistent.

    I think this is all going to come down to the employees CA tax Filing Status.

    As you noted in your first reply I can get the $92.75 in both versions if I change the filing status in the legacy version from M to M1 and leave Dependent Exemptions at 2.  Legacy versions had 5 different CA statuses:

    H - Head of Household

    M - Married 2+Allowances

    M1 - Married 0-1 Allowances

    MD - Married Dual Inc

    S - Single

    The 2018 version only has 3 different status:

    H - Head of Household

    M - Married

    S - Single

    I'm going to guess it has something to do with the consolidation of the 3 married status in the 2018 version.

    Still waiting to hear back from support.  If they can shed any additional light on this I'll post again.

  • Ever get a solution on this?

  • in reply to Biljol

    Looks to me like it was resolved even though it is not marked as such.

    California has an interesting system.