State Tax Levy Rules for California Referring to State Minimum Wage and not Federal Minimum Wage (Doc ID 2025033.1)

Last updated on DECEMBER 06, 2016

Applies to:

Oracle HRMS (US) - Version 12.1.3 and later
Information in this document applies to any platform.

Symptoms

On : 12.1.3 version, Wage Attachments/Garnishments

ACTUAL BEHAVIOR
---------------
State tax Levy element for CA is referring to State Minimum Wages and not Federal Minimum Wages

For California, the formula is referring to the State Minimum Wage for employees disposable income, and not to the Federal Minimum Wage.

In the wage exception screen, the setup is done for Greater of (75% of Gross wage or 40 times of federal Min Wage), but it is referring only to the State Minimum Wages for processing.



EXPECTED BEHAVIOR
-----------------------
Expect that the Federal Minimum Wage is used as stated in the California legislative Statutes

As per California Law, following logic should be used for calculating State levy :

 refer (https://www.ftb.ca.gov/individuals/ewot.shtml)

How to process an EWOT payment -- including payment instructions

Step 1 - Determine your employee's disposable earnings.

•Calculate your employee's gross earnings, which include bonuses and commissions.
•Then subtract the lawful deductions below from gross earnings: ◦Federal income tax.
◦Social security.
◦State income tax.
◦State disability.


Step 2 - Once you determine the amount of disposable earnings, find the withholding amount on the chart below. Or use our withholding calculator to determine the withholding amount.

If your pay periods are
And your employee's
disposable earnings are

Withhold and send this amount
 Use the instructions on PAGE 1A in box 5.

Weekly
 
$0 - $217.50
 
None
 

$217.51 - $290.00
 
Amount above $217.50
 
$290.01 or more
 
25% of the disposable earnings
 



BUSINESS IMPACT
-----------------------
The issue has the following business impact:
Due to this issue, users cannot accurately calculate the State Tax Levy for California

Cause

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