How to Verify Microsoft Dynamics GP is calculating Payroll taxes correctly

855655 Federal Tax Calculation - Steps of how Microsoft Dynamics GP annualizes its payroll calculation of taxes

Because Microsoft Dynamics GP annualizes its taxes, what drives the calculation is the pay period or the frequency fields on your pay codes, benefits, and deductions.

Common Misconceptions:

• The pay code pay period field set to weekly, as they have a weekly payroll, but the deduction will be set to monthly as it is only taken out once a month. **The frequency field on a deduction/benefit does not control when the deduction is taken, but instead the tax calculation of that deduction.
• "I am paying a bonus and hardly any taxes are getting taken." If you look at the pay period of the bonus, it is annual, as it is an annual bonus, not realizing this affects tax calculation.

CLICK HERE to check out a free tool that allows you to do what if scenarios and verify if Microsoft Dynamics GP taxes are really correct!


Compliments of the Dynamics GP Support Blog

Drill Down to Dynamics GP windows from Excel

Microsoft Dynamics GP 2010 has a new feature called Drill Downs. This is somewhat similar to the Office SmartTags product that was available in previous releases. This functionality allows you to create drill downs from an Excel Report, SSRS report, etc. that will open a Microsoft Dynamics GP window for you with the data you are drilling back on populated. By default, there are many of them setup, but you can also create your own if you have the Drill Down Builder product that is available in the package with SmartList Builder and Drill Down Builder.

The drill downs aren't in place by default in the Excel Report files, but are in the Data Connections that those reports use so that you can pull them into the Excel Reports.

CLICK HERE to take a look at how to get one added to an Excel Report.

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US Payroll Tax Update - Round 2

The US Payroll Round 2 Tax Update has been released.

**If the above changes do not effect you, you do not need to install the update.

CLICK HERE to read more about the Tax Update Changes

Scheduling
Please contact Renny Staab at 949-457-0500 x206 or rstaab@collinscomputing.com to schedule the installation of US Payroll Round 2 Tax Update. **Reminder: US Payroll Round 1 Tax Update must be installed prior to installing Round 2

Payroll Tax Cut Temporarily Extendeed into 2012
Below are answers to a few questions regarding how this effects Dynamics GP

• With this tax cut/extension, should we use the 2011 federal tax tables or 2012? You should be using the 2012 federal tax tables that are released in publication 1035, see link: http://www.irs.gov/pub/irs-pdf/n1036.pdf
  The Microsoft Dynamics GP 2012 Round 1 Tax Update has the correct rates installed.
  
• Did Microsoft implement the "Recapture" provision in the round 1 tax tables for 2012? No, they did not. If you review the guidelines, the article indicates that the additional 2% will be paid in 2013 when the employee files their 2012 tax return. If that's the case then it looks like you should be OK with leaving the FICA at 4.2% even if they exceed the $18,350 threshold for these type of employees. At this point Microsoft is not changing anything around the recapture amount unless more guidelines are released. http://www.irs.gov/newsroom/article/0,,id=251650,00.html
  
• Employee, 4.2 or 6.2? On Tuesday, December 27, 2011, Microsoft Dynamics GP re-released the round 1 tax update for 2012 due to congress passing the 2 month payroll tax extension changing the employee FICA rate from 6.2 (previously released) to 4.2.
  To tell you have the correct rate, the new date under Tools Setup System Payroll Tax is 12/29/2011.
  If it is 12/23/2011 that is the old rate (6.2)
  
  You can also tell by pulling up the FICAS code from this window, choose Filing Status, choose NA, click Tables, you will see the rate and wage limit for 2012.
  
  The Social Security wage base limit has been increased to $110,100 for employer and employee.
  
  Note: If the date value in the Payroll Tax Setup window is 12/23/2011, you must reinstall this update in order for the FICA employee tax rate to be updated to 4.2%
  
  If you paid an employee in 2012 and withheld at the 6.2 rate, you will need to pay them back this money by March 31, 2012. You can do this in Microsoft Dynamics GP as a business expense paycode to pay the employee back the money and then adjust your taxes through the manual check window.

If you have any questions or need help, please contact support@collinscomputing.com.

Inventory Stock Counts & HITB Tips

Here are a few articles that may help from the accounting side;

• KB 950020 - Info about posting transactions for a stock count that has been started in Inventory in Microsoft Dynamics GP
• KB 862352 - Error message when you enter an amount in the Variance Qty field in the Inventory Stock Count Entry window in Microsoft Dynamics GP: "The quantity entered is greater than the quantity available"
• KB 929210 - Error message when you perform a stock count on a serialized item in Microsoft Dynamics GP: "The variance or counted quantity for this serial number does not equal the variance or counted quantity for this item"

If you have just gone through a stock count and you are "good" with your inventory, then now is a perfect time to implement HITB as you are confident in your item quantities!

If you are not already printing the Historical Inventory Trial Balance (HITB) report and using it to reconcile to the GL, how come? The HITB report was designed with reconciling to General Ledger in mind. It provides you a point in time value of your inventory items as well as their quantity information. This way you can go ‘back in time’ and see what the value of your inventory was on a certain day.

To print this report from the Reports menu point to Inventory and then choose Activity reports. “Historical IV Trial Balance” should be the last one listed. If you do not see it, then you have been using GP for a while (say pre-R10 SP2 days) and you must go through an IV Reset process in order to “activate” HITB so that you can start capturing this data.

What does the IV Reset process does and how to do it? CLICK HERE

Once HITB has been activated any new transactions that affect your item’s cost will be captured in the SEE30303 table for reporting. The sooner you do the IV Reset the sooner you can start using the report!