Starting with Sage 100 Contractor version 24.2, the software can now retain multiple years of payroll records in your current company, as it now offers the option in menu 5-3-8 to close your payroll year rather than archiving the oldest payroll year from Database Administration for Sage 100 Contractor. This article addresses common questions regarding this new feature.

Q. What does closing a payroll year do?

A. When you close the payroll year in 5-3-8 Close Payroll, Sage 100 Contractor does the following:

• Saves certain payroll data separately from the current records for the year that you're closing.
• Clears each employee’s YTD and QTD totals, including sick and vacation YTD amounts.
• Updates each employee’s Last Year Carry Forward amounts with the current available Sick and Vacation hours.
• In the U.S. Edition, creates employee ACA records for the new year by copying the December values from the closing year.
• Updates the first pay period paid in the current year ended on for the biweekly payroll period setting in the 5-6-6 Time Entry Settings window.
• Advances the current payroll year.

Q. What is the difference between closing payroll and archiving oldest payroll year?

A. Closing payroll and archiving oldest payroll year essentially perform the same functions (listed above in the answer to the previous question), with these notable differences:

• Closing payroll is much faster than archiving payroll, typically taking only several seconds to complete. This will save you considerable time at year-end.
• Archiving oldest payroll year removes all payroll records in the database (regardless of year) and places them into a separate payroll archive database. Closing payroll does not remove records or create a separate archive database
• Closing payroll does not allow you to delete 5-3-1 payroll calculations used in the closed year as those calculations as the payroll records referencing those calculations are still in the current database. You will need to archive the payroll year to delete unwanted payroll calculations. They can however be deleted from the employee's calculations in 5-2-1 as long as they have not been used in a payroll record for the current year for that employee (including voided records).
• Archiving oldest payroll year allows you to optionally remove employee records with a Laid Off, Quit, Terminated, Deceased, and Retired status. Closing payroll does not remove any employee records.

Q. What should I do before closing a payroll year?

A. The processes for preparing to close a payroll have not changed. Essentially these are the tasks, in this order:

1. Finish processing all payroll records (final compute and post) for the payroll year you are closing. You may start entering payroll records for the new year as long as you don't compute them (leave in Open status).
2. Run a 5-3-7 Payroll Audit, choose the Repair option and address any payroll audit errors as needed.
3. Install the Sage 100 Contractor year-end tax update (usually available in mid-December).
4. Run 5-3-8 Close Payroll - you must be logged in as company admin and payroll admin (if you are using this feature)
5. Update your rates and maximums for the new year as needed in:
   • 5-2-1 Employees (Calculations)
   • 5-3-1 Payroll Calculations
   • 5-3-2 Workers' Compensation
   • 5-3-4 Paygroups
   • 5-3-4 Paygroup Benefits
   • 5-3-6 Local Payroll Tax
6. You can now begin processing payroll for the new year.

For additional information, visit the Year-End Center in Sage City.

Q. How does Sage 100 Contractor know what payroll records to include when closing a payroll year?

A. When you close a payroll year, Sage 100 Contractor looks at the Check Date field in the payroll record to determine if that record should be included in the payroll close process for that year.

Q. What happens if I close a payroll year after I have already started processing payroll for the new year?

A. The payroll close will only include payroll records that have a check date for the year that you are closing. Records dated after will not be affected by the close. However, Sage recommends that you do not process records in the new year until after you have closed the previous year.

Q. Can a payroll close be undone or reversed?

A. You cannot undo or reverse a payroll close, so it is recommended you have a current backup of your company before closing the payroll year.

Q. How do I remove payroll records in a closed payroll year from my current company?

A. In Database Administration, go to Archive Company Data > Archive Oldest Payroll Year and select your current company. You can only archive the oldest closed payroll year in your company and do one payroll year at a time. This process removes the payroll records just for that year and creates an archive database for them.

Q. Can I run reports and process Aatrix forms for the closed payroll year?

A. Since the payroll close retains the payroll records in your company, you can run payroll reports and process Aatrix forms in 5-4-1 and 5-4-2 for those records.

Q. Can I add, edit, or void payroll records in a closed payroll year?

A. You can add, edit, and void payroll records in the closed year immediately preceding your current payroll year. Any payroll records with a check date older than that are read-only. For example, if you have closed 2021 and 2022 and your current year is 2023, you may only make changes and add records in 2022 and 2023; records in 2021 will be read-only.

Q. What happens if edit, void, or add a record in a closed payroll year?

A. When you edit, void, or add (which includes changing the date in the Check Date field so it now falls into a closed year) a payroll record for a closed payroll year, the software automatically updates the stored information for that closed year for that employee. It then performs a payroll repair to adjust the YTD totals and any affected carry-forward totals for sick and vacation time.

Q. If I add and compute a payroll record with a Check Date in a closed payroll year, will it use the calculation rates and maximums for that year?

A. The computing process in payroll will always use the current rates and maximums in your company, not the rates for the closed year. For this reason, you may need to override calculation amounts where the rate was changed after you closed payroll.

Q. How will I know if a payroll year has been closed, or if a payroll record is in a closed year?

A. In 5-2-2 Payroll Records, if you click the selection arrow (or press F5) for the Record# field and display the record selection window, there will be a View By filter at the top that defaults to 'Current Year'. You can change this to 'All' to show all records from both the current year and any closed years. If you have no closed years; then, the View By filter will not be present.

Q. How many years of closed payroll records can I keep at one time?

A. There is no limit to the number of closed years you can have in your company.  If you want to remove older closed years, use the "Archive Oldest Payroll Year" feature in Database Administration for Sage 100 Contractor.

Q. Does closing the payroll year affect my General Ledger?

A. Closing a payroll year does not affect your General Ledger transactions and balances.

New Feature: 5-3-8 Close Payroll Year