Example

• The employer pays the employee for 40 hours at $20.00 per hour, totalling $800.00
• We add an Other Pay of $150.00 to the gross amount
• The employer assigns the employee a task code for the payroll tax account of 5101
• The default posting account for payroll taxes assigned in PR, Utilities, Maintain PR Parameters, Posting Accounts is 2123
• The employee has a pretax 401k deduction in the amount of 52.00

Calculation

• The total gross is 800.00 +150.00 for a total of 950.00 gross pay
• Subtract the pretax 401K deduction of 52.00 for taxable wages of 898.00
• The Employer portion of OASDI and Medicare is 7.65% times the taxable wage of 898.00 = 68.70
• We split the amount between Other Income and Hourly Gross (Task Code)

• • Total wages 950.00
  • 800.00 hourly gross is 84% of the total gross wages (800.00/950.00 to get the percentage)
  • 150.00 other income is 16% of the total gross wages (150.00/950.00 to get the percentage)
  • The total payroll tax liability of 68.70 is divided by the percent of income
    (68.70 * 16% = 10.99 will post to the default GL account 2123)
    (68.70 * 84% = 57.71 will post to payroll tax account 5101)
    

    

Set up and add an Other Pay to employee paycheck