How to Setup a Local Tax Codes in Sage 100

Description

Sage 100 ERP does not support reciprocity tax reporting. For more details and possible workaround, see related article How to Setup Multistate Employees

Resolution

Please note that these instructions are a basic overview for setting up a local tax code.

Sage does not assist in setting up tax calculation steps for local tax codes. Consult the local government for instructions pertaining to specific tax laws.

1. Open Payroll, Setup, Payroll Options
2. Select the Require Local Tax Reporting box
3. Type a Default Local Tax Code into the Default Local Tax Code field (not required)
4. Click Accept
5. Open Payroll, Setup, Tax Table Maintenance
6. Select State code from look up and press ENTER
7. Type a 3 character Local Code into the Local field and press ENTER (Note: This field is user defined)
8. Select an applicable Local Tax Description from drop down list. Note: This is required in order for Local Tax Data to populate into tax reporting forms
9. Enter the Company’s Tax ID number and press ENTER
10. Select appropriate G/L Accrual accounts.
11. Note: It is necessary to enter G/L Accounts into all account number fields or you will receive the message “A missing or invalid G/L account has been found in tax code:”
12. Click Edit Steps button.
13. The options that are selected here will depend on the Local jurisdiction’s tax laws
    • Once the proper tax calculation steps have been specified in the Edit Tax Calculation Steps window click Ok
14. Click Filing Status button
15. Create the Filing Status. (Create more than one if necessary) (for example: A=All)
16. Click Accept, the Tax Table window will open:
17. Enter the tax rate(s) in the Percentage of Excess field.
18. Click Ok
19. Click Accept

To assign the local tax code to an employee:

1. Open Payroll, Main, Employee Maintenance
2. Click on Wages tab, select applicable Local Tax Code from look up
3. Click Tax Status button
4. Select applicable Local Filing/Tax Status from look up
5. Click Accept twice