After Application of 20000288 - R12.HR_PF.B.DELTA.8 (HRMS 12.1 RUP8), the Pretax Calculations for the Cities in the States of Ohio, Kentucky, New York are Incorrect (Doc ID 2042468.1)

Last updated on SEPTEMBER 15, 2015

Applies to:

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


On : 12.1.3 version, US Payroll Tax Issue

City tax not calculating correctly for multiple cities in Ohio after the application of <patch 20000288> - R12.HR_PF.B.DELTA.8 (HRMS 12.1 RUP8).

The application is incorrectly recognizing deferred compensation pretax deductions for cities in Ohio and reducing the taxable by the pretax, therefore, causing the employee's deductions for city taxes to be under withheld. 

Expect city tax to calculate correctly for multiple cities in Ohio.  For example, the city of Parma, OH is incorrect

For the cities in the State of Ohio, the 401k should be taxable.

The Vertex guide correctly shows that 401k is Taxable for Local Withholding.


The issue can be reproduced with the following steps:

1. Navigate to Total Compensation > Tax Withholding Rules > Taxability Rules
2. Check "Pre-Tax Deductions"
3. Check "City Taxes"
4. Include: State: Ohio, and City: Parma
5. Check if the "Default Rules Edited"
6. See multiple Tax Category options to include: Def Comp Taxable by JD 401K, Def Comp Taxable by JD 403B, Def Comp Taxable by JD 457, Deferred Comp 401K, Deferred Comp 401K Catch-UP, Deferred Comp 403b, and Deferred Comp 403b Catch-up - all have "City Income Tax" box Checked.
7. Following application of RUP 8: See the same Tax Categories; however, the Subject To: "Overridden Specific Tax."

8. Reviewing the city tax deduction before RUP 8 for example the tax amount was $55.76.  After RUP 8 the tax deduction was $53.52. 


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