E1: 77: Federal CA does not Include the Additional Tax when an Employee is Paid with Regular Pay Type Along with Non-Taxable Pay Type that Includes an Additional Federal Tax (Doc ID 2827312.1)

Last updated on JULY 03, 2023

Applies to:

Symptoms

The Federal income tax (tax type CA) is not including the Additional Federal Tax when the employee paycheck is included both regular pay type and non-taxable pay type.
For example, An employee that has an additional tax amount of $95. The taxable gross is 2166.92. This employee also has a non-taxable gross pay type in the lump sum of $5000. The Federal CA taxable gross is 2166.92 and the Federal tax amount is 253.99. However, when remove the non-taxable pay type, the Federal taxable gross remain unchanged at 2166.92 but this time the tax amount is 348.99, which take in account of the additional $95.


STEPS
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1. From Employee P0801 setup a Canadian employee with the above criteria
2. From DBA P059116 set up a non-taxable pay type
3. In P07210I create an interim check with regular pay plus the non-taxable lump sum amount. make note of the federal CA tax amount and taxable gross.
4. Repeat step 3 but this time remove the non-taxable pay type. make note of the federal CA tax amount and taxable gross
5. Confirm that when pay the employee with the non-taxable pay type, even though the taxable gross is unchanged, the system do not take the $95 into consideration.

 

Cause

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