Note: You must subscribe to a Sage 50 Payroll Solution to set up Deduction formulas and have the deduction amount calculated within Sage 50. If you have not subscribed to a Sage 50 Payroll Solution, you can set up the deduction employee payroll field, then manually compute and enter the amount on the employee's check.

Section 1: Set up the deduction formula

Note: The following example illustrates a 2% deduction from wages earned after taxes. Adjust these instructions accordingly.

1. Click File, Payroll Formulas, User-Maintained.
2. Enter a Formula ID (for example, DEDUCTION).
3. Enter a Name using the NAME[space]YEAR rule (DEDUCTION 12).
4. Classify this formula as a Deduction.
5. Leave Filing Status at All.
6. Clear the Use this formula as a filter on the Payroll Tax report field.
7. In the Formula box, enter the following:
   "The following deduction formula takes the adjusted gross and subtracts the standard taxed deductions of Fed_Income, Soc_Sec, Medicare, and State. It calculates 2% of the resulting net amount."
   
   ANSWER=-(ADJUSTED_GROSS+Fed_Income+Soc_Sec+Medicare+State)*.02
   
   Note: The above formula is based on the defaulted Sage 50 payroll setup. It assumes that you have set up in Employee Default Information the payroll fields Fed_Income, Soc_Sec, Medicare, and State. If you have a local tax, the payroll field corresponding to it needs to be added to the formula. Normally this is Local. If you modified the name of these payroll fields, you will have to alter the formula to include the correct payroll fields (taxed deductions only). Your formula needs to reflect something similar to the following:
   
   ANSWER=-(ADJUSTED_GROSS+EE PAYROLL FIELD 1+EE PAYROLL FIELD 2+EE PAYROLL FIELD 3+. . .)*.02
   
   The sentence within quotes above the actual formula is meant as a comment or reminder of how the calculation is set up. Adding the comment is optional.

Section 2: Set up the Deduction employee payroll field

1. Click Maintain, Default Information, Employees.
2. Click the Employee Fields tab.
3. Enter a Field Name for your deduction . What you enter here will print on employee paycheck stubs in the deduction area.
4. Select a general ledger account from the G/L Account column.
5. Click OK.

Section 3: Apply the deduction formula to the deduction employee payroll field.

1. Click Maintain, Employees/Sales Reps.
2. Select the applicable employee.
3. Click the Employee Fields tab.
4. For the Deduction payroll field, uncheck the Use Defaults field, and check the Calculated field.
5. Select the deduction formula that was setup in Section I.
6. Click the Adjust button for this field.
7. Select the Use field next to gross Gross. In most cases, Gross is the only payroll field necessary for calculating garnishments. Check with your accountant if you are not sure about your situation.
8. Click OK.
9. Save the employee record, and close the window.

Note: When creating a formula using Hourly and Salary fields ensure that you capitalize the names, HOURLY and SALARY.

SES - Sage Expert Services for Sage 50—U.S. Edition Payroll Formula Configuration Service
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