Flexgen Payroll Deduction Maintenance

Highlights Set up Payroll Deduction Controls Employer Sponsored Health Care Reporting Employer Matching and the Calculations Deduction General Ledger Entries Deduction Premium Changes W2 Reporting

Gather insurance rate information for each insurance option that is available to your employees. Consider the following: How many times a year do you take the deduction for payroll? Does the county/city pay any portion of dental insurance or vision insurance? What GL liability account number do you use for each insurance? Do you offer sheltered and non-sheltered options? Things to do before setting up deductions

Setting up Payroll Deduction Codes Reports, Control, Control A-J, Deduction Code Summary Print the Deduction Code Summary Report before making any changes

Setting up Payroll Deduction Codes Within the Payroll Menu Choose: -Other -Control Within the Control Menu Choose: -Control A-L -Deduction Code Next, we will review each field within the Payroll Deduction Screen. Note: Look Up (F2) and Help (F1) is available for each field

Deduction Code The Deduction Code number is user defined. Assign a number not previously used

Deduction Code Description Description should be detailed enough to distinguish each deduction from another

Deduction Code Screen Description This abbreviated description is printed on the check stub, therefore should be meaningful to the employees

Deduction Code Classification Select the Classification for this deduction. Health Insurance is generally a Regular Voluntary Deduction

Deduction Code Function Enter the liability account used in posting to the GL when this deduction is taken An “X” in CC or SOb attaches the employee’s cost center or sub object to the liability account

Deduction Code Grouping Deductions can be grouped together on the insurance report

Deduction Code - Sheltered From The Sheltered From indicators tell the system whether to calculate taxes before or after this deduction is taken Sheltered From Yes means to subtract this deduction before calculating taxes Sheltered From No means do not subtract this deduction before calculating taxes The Sheltered From indicators tell the system whether to calculate taxes before or after this deduction is taken Sheltered From Yes means to subtract this deduction before calculating taxes Sheltered From No means do not subtract this deduction before calculating taxes

Standard Non-sheltered Deduction Cafeteria Plan Sheltered Deduction Deduction Code - Sheltered From A little FYI…“Cafeteria plan” is named such because it is similar to a cafeteria where individuals select their food of choice, employees may choose benefits of their choice.

Primary elements of cafeteria plan deductions Classification of Regular Vol Ded is chosen Sheltered From indicators are normally YES (except TCRS retirement) W2 Cafeteria Plan indicator is YES Employee amount of cafeteria plan will be recorded as DDNTB in box 14 of the W2 Primary elements of cafeteria plan deductions Classification of Regular Vol Ded is chosen Sheltered From indicators are normally YES (except TCRS retirement) W2 Cafeteria Plan indicator is YES Employee amount of cafeteria plan will be recorded as DDNTB in box 14 of the W2 Deduction Code – Cafeteria Plan

Two Amount Types 01 - Flat Amount 02 - Percentage Two Amount Types 01 - Flat Amount 02 - Percentage Deduction Code - Amount Type & Default Flat Amount This is the amount PER PAY PERIOD If the deducted amount is the same for everyone, a default flat amount may be entered Leave Blank if amount varies per employee This is the amount PER PAY PERIOD If the deducted amount is the same for everyone, a default flat amount may be entered Leave Blank if amount varies per employee

Deduction Code – Employer Sponsored Reporting Code 34 DD in Form W-2 Box 12 is not necessary to report employer portion but is ok if you do fill it in as such Set the Emplyr Sponsored Health Ins flag to 01 YES to report in Box 12 of the W2 as code DD (default is NO)

Amount to be deducted (per pay period) Total Premium (per pay period) Employer Exp (per pay period) Obj Code used for employer expenditure Deduction Code Control – For Employer Matching

Deduction Code Control Screen Your final screen will look something like this. Repeat for each and every insurance option Check with your plan provider for the correct setting on the fields: (Dependent Care; Section 457; Nonsection 457; Qualified)

Once the deduction codes are set up, you will add the deduction code to the employee deduction screen Employee Deduction Screen Payroll Master PayInf (F9) Deduction Add (F5) LookUp (F2). Page Up or Down to find deduction to be linked to this employee Deduction Scroll is also a good way to add deductions

Consider this… If you take the steps mentioned above, your system will accumulate reporting amounts.

The system subtracts the deducted amount from the total premium amount to determine how much should be posted to the GL as the employer expense, posting to the employee’s distribution Fund, Function & Obj Code (& Cost Center & SOb if used) Automatic Employer Matching - Calculation Amt Deducted Subtracted from Employer Expense Employee Deduction Deduction Control File

If deduction is paid in full by employer Set up a default flat amount to zero in order to calculate the employer’s expense If deduction is paid in full by employer Set up a default flat amount to zero in order to calculate the employer’s expense Automatic Employer Matching – Employer pays Total Premium Subtracted from Employer Expense

Automatic Employer Matching - Correction Subtracted from Employer Share Don’t just double the deduction amount to “catch up” a deduction

Automatic Employer Matching - Correction Add the Deduction Twice to the employee That way the matching calculation is done twice

GL Entries – NOT using Employer matching Note: When NOT using automatic employer matching, the payroll system only generates posting for the employee’s portion of health insurance.

GL Entries – using Employer matching Note: When using automatic employer matching, the payroll system allows posting for the employee, as well as, the employer portion of health insurance to the liability account. Also the employer expense account is automatically debited.

WHEN WRITING CHECKS No Expenditure accounts are used on checks to the insurance company, ONLY Debit Liability accounts once Automatic Matching is implemented WHEN WRITING CHECKS No Expenditure accounts are used on checks to the insurance company, ONLY Debit Liability accounts once Automatic Matching is implemented GL Entries – using Employer matching

Deduction Premium Changes Reports, Control, Control A-J, Deduction Code Summary Print the Deduction Code Summary Report before making any changes

Deduction Premium Changes Reports, Payroll, Emps/Itm A-L, Deduction Code Print the Employees Per Deduction Report before making any changes

From this If amount is deducted twice a month, the amounts would be half To this

Once change is made to deduction control, it does not automatically update employee deduction amount Likewise, you cannot simply change employee’s flat amount without changing the deduction control

Reprint Deduction Code Summary Report to confirm changes made to Deduction Control Deduction Premium Changes

Various Ways to Change Employee Deduction Amounts Deduction Maintenance through Payroll Master Deduction Scroll Auto Update

Deduction Scroll Other, Deduction Scroll

From this To this Update (F4) scrolls to next person with that deduction

Deduction Scroll Other, Deduction Scroll If chose All Employees or Only Employees Without Deduction

Auto Update Other, Update, Auto Update, Deduction Amount/Percent Defaulted in from deduction control Enter in the amount to match the control

Deduction Premium Changes Reports, Payroll, Emps/Itm A-L, Deduction Code RE-Print Employees Per Deduction Report to confirm changes Before After

W-2 Report shows the employee ($575.38) plus employer portion ($643.76) coded with DD and will be shown in box 12 of the W-2 W-2 Reporting

W-2 shows the employee ($575.38) plus employer portion ($643.76) coded with DD in box 12 of the W-2 The employee portion is coded with DDNTB in Box 14 if marked Caf Plan

W-2 Reporting – Build Health Coverage File Build Health Coverage File – These options are only required if you have not had the deduction code control set up for employer contribution for the entire calendar year for the Employer- Sponsored health insurance and/or need to make changes to the deduction amount. Build by Calendar Year and selected deduction codes. Deduction(s) must have “Emplyr Sponsored Health Ins” flag set to “Yes” on the deduction control.

W-2 Reporting – Build Health Coverage File The amount in the Corrected Health Coverage field should be the total employEE plus employER. In this example, the employER portion is increased by $100

Any Questions?

This concludes our session on Flexgen Payroll Deduction Maintenance Visit our website for full documentation and useful information for other applications