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Tax Issue For Kentucky Localities, Supplemental and Imputed Earnings, When Percentages Are Used (Doc ID 2869999.1)

Last updated on JULY 09, 2024

Applies to:

Oracle HRMS (US) - Version 12.2.9 and later
Information in this document applies to any platform.


On : 12.2.9 version, US Payroll Tax Issues

Tax issue for the Kentucky employees who went from working from home (KY) 100% to working from home (KY) 40%.
Kentucky local taxes no longer include Imputed Group Term Life (GTL) in taxable wages when partial percentage applied.
Did include GTL when employee was working in Kentucky 100%.

Imputed Group Term Life (GTL) is not included in Kentucky local wages or tax calculations when tax rules on employee record set to less than 100%. Imputed Group Term Life is included (correctly) when “Working At Home” box is checked on Standard Conditions Tab.

The issue can be reproduced at will with the following steps:

US Super HRMS Manager or equivalent responsibility

1. Vertex Tax Interface is set to Enhanced + Wage Accumulation.
2. Work Structures > Organization > GRE/Legal Entity > State Tax Rules > Resident Wage Accumulation - KY set to “All Localities”
3. Taxability Rules are checked to tax at city and county for GTL
4. Work Location - Crescent Springs, KY Kenton county - example
5. Employee is set up as 60% Ohio and 40% Kentucky
6. Process a payroll for the employee
7. See the county and city taxable wages, Crescent Springs, KY Kenton county, do not include the Group Term Life




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