How to Manage Employee Taxes
Employee taxes can be managed under the employee record > pay setup > taxes. However, there a few steps we should be aware of prior to making adjustments to this area.
Tax setup information can be entered using the “Add Employee Quick Wizard” or on the employee record by navigating to employee > pay setup. If you use HRCenter, the employee’s tax information will postfill directly from what is entered on their W-4.
If entered through quick add, we can find this information under employee > pay setup. We can also enter additional Federal Withholding amounts in this area below federal and state exemptions.
Since employees are taxed based on where they live and work, Enterprise will take both the permanent address listed on the employee record as well as the address on the order worksite to calculate tax amounts.
1. Address on employee record
2. Address on order worksite
*Note – If the employee should only be taxed by the state in which they live, you can select the check box “Tax by Employee State” under the employee record > pay setup. Doing this will ignore the address on the order worksite. Since each state has a different reciprocity agreement, please consult with a tax professional before selecting this option.
There will not be any tax jurisdictions set up yet under employee > pay setup > taxes on an employee who has not been paid. Enterprise automatically populates these once the employee has received their first check. See screen shots below for before and after the employee has been paid.
*Note - if you do need to enter additional state withholding prior to cutting a check for the employee, you can select the "+" icon in the upper right hand corner of the employee taxes screen and select which jurisdiction the additional withholding amount should be for. See screen shots below for examples.
1. Employee has not received any checks
2. Employee has received at least one check
Once the taxes have populated based on the employee and worksite addresses, we can see those taxes appear under the pay setup area. To view the jurisdiction details, you can double click the juris to bring up additional tax information. If you’d like to add additional allowances or state withholding amounts, you may do so from this area.
*Note - You may also select the "exempt" box in this tax wizard area if the employee should be exempt from all taxability. When selecting the exempt box, Tempworks will prompt you with a notification clarifying what this action will do. Please make sure you consult with a tax professional before selecting this option as it will lead to no W2 being generated for this employee and could cause issues during year-end if set up incorrectly.