How to set up payroll garnishment

How to set up payroll garnishment

Support Team Asked on January 6, 2018 in Sage.
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  • 1 Answer(s)
    Resolution

    Option I: Flat-Rate Garnishment

    1. Click Maintain, Default Information, Employees
    2. Select the Employee Fields tab
    3. Scroll down until you find an empty field and enter a Field Name; this will appear on paycheck stubs
    4. Select a G/L Account
    5. Click OK
    6. Click Maintain, Employees/Sales Reps
    7. Select the applicable Employee ID
    8. Select the Employee Fields tab
    9. On the line with the field name that was created on Step 3, uncheck Use Defaults
    10. In the Amount field, enter the deduction amount as a negative number
    11. Click Save

    Option II: Calculated Garnishment

    Step I: Set up the garnishment formula

    Note: This formula allows the rate to be set for each employee, making it possible to have multiple garnishment rates for different employees with a single formula

    1. Click File, Payroll Formulas, User-Maintained
    2. For Formula ID enter GARNISH
    3. For Tax Name enter GARNISH XX (with XX being the two digit current year)
    4. Set How do you classify this formula? to Deduction
    5. Set Filing Status to All
    6. For Formula, enterANSWER=-(ADJUSTED_GROSS+Fed_Income+Soc_Sec+Medicare+St_Income)*.30

      Note: .30 can be replaced with what ever percent you would like the garnishment to deduct, however using this formula, requires not assigning the formula in the defaults as indicated in Section III, as otherwise the rate would apply to all employees. Also payroll fields may not be the same in your company.  Please check by selecting MaintainEmployees, and Employee Fields tab to verify the payroll field names

      Another Formula you can use is below

      ANSWER=-((ADJUSTED_GROSS+Fed_Income+Soc_Sec+Medicare+St_Income) * EMP_SPECIAL1_NUMBER/100)

    7. Click Save and close User-Maintained Formulas

    Note: Some state’s income tax calculations require the use of the Special 1 field; if this is the case for your state, substitute EMP_SPECIAL2_NUMBER.

    Note: If the formula is being set up for company that resides in a state not subjected to state taxes, remove the St_Income field from the Formula Description above.

    Note: Add or substitute the field names in the formula for the taxes that should be taken out before the computation of the garnishment. Consult your accountant if unsure.

    Step II: Set up the garnishment employee payroll field

    • Option I: Using a formula with EMP_SPECIAL1_Number Assignment

      Note: If your formula does not use EMP_SPECIAL1_NUMBER or EMP_SPECIAL2_NUMBER to assign a percentage, use Option II.

      1. Click MaintainDefault InformationEmployees.
      2. Select the Employee Fields tab.
      3. Enter a Field Name for the garnishment; this name will appear on payroll stubs.
      4. Select a G/L Account.
      5. Select Garnish from the Formula drop-down list.
      6. Click the Adjust button.
      7. In the Employee Field Names section, click the checkbox for Gross.
      8. Click OK on the Adjusted Gross window, and then again on the Employee Defaults window.
    • Option II: Using a formula with a fixed percentage defined
      1. Click MaintainDefault InformationEmployees.
      2. Select the Employee Fields tab
      3. Enter a Field Name for the garnishment; this name will appear on payroll stubs
      4. Select a G/L Account
      5. click OK to close the defaults.
      6. Go to Maintain, and select Employees / Sales Reps….
      7. In the Maintain Employees & Sales Reps window, select the applicable Employee ID.
      8. Select the Employee Fields tab.
      9. Locate the field for the garnishment setup in step and uncheck the Use Defaults box.
      10. Mark the Calc check box, click in the Formula field, and select the Garnish formula from the list.
      11. Click the Adjust button on the line for the garnishment to open the Calculate Adjusted Gross window.
      12. Select Gross in the list on the left side of the window and click OK.
      13. Click Save to commit the changes to the employee’s record and close the window.

    Step III: Set applicable employees to calculate the garnishment

    Note: If you do not set a rate on the Withholding Info tab, the garnishment will automatically calculate at $0; there is no need to uncheck Use Defaults on employees not being garnished.

    1. Click Maintain, Employees/Sales Reps
    2. Select the applicable Employee ID
    3. Select the Withholding Info tab
    4. On the Special 1 line, enter the garnishment percentage into the Addl Withholding field, without the percent sign (for example, 25% should be entered as 25.00)
    5. Click Save, then close Maintain Employees/Sales Reps

    Troubleshooting

    If the garnishment is not calculating when creating payroll:

    1. Verify that the garnishment field has been set to calculate on the employee’s record
    2. Verify that the date of the check correlates with the current year selected for the Garnishment formula. This will be the case if the Error: “The following formula listed on the Employee record does not exist in payroll formula’s…Garnish XX” exists when processing payroll after creating formula and setting up employee.
    3. Verify that Gross has been checked Use in the garnishment line’s Adjustments on the employee record
    4. Verify that there is a pay amount on the check
    5. Verify that the taxes and any other deductions that were marked Use do not reduce the net pay to $0

    Source: Sage Community forums.

    Disclaimer: Sage Accounting Solution is an independent provider of Sage Related services and is not affiliated with Sage.

    See More: Support for this issue is available either by self-service or paid support options. Experts are available to resolve your Sage issue to ensure minimal downtime and continue running your business. First try to resolve the issue yourself by looking for a resolution described below. If you are experiencing too many issues, you may want to more info Call Sage Support Phone Number

    Support Team Answered on January 6, 2018.
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