How to set up an exempt employee

How to set up an exempt employee in Sage 50 Accounting.

Employee is exempt from Federal withholding

1. Go to Maintain > Employees/Sales Reps.
2. Select the Employee ID who is exempt from one or more payroll taxes.
3. Browse to the Withholding Info tab.
   • For employees hired after January 1, 2020
     • Enter 99,000 or greater in the Line 4b - Deductions Annual Amt field
   • For employees hired before January 1, 2020
     • Enter 99 for the Allowances

Employee is exempt from Social Security and/or Medicare

1. Go to Maintain > Employees/Sales Reps.
2. Select the Employee ID who is exempt from one or more payroll taxes.
3. Browse to the Employee Fields tab and uncheck Use Defaults and Calc for Social Security and Medicare.
4. Browse to the Company Fields tab and uncheck Use Defaults and Calc for Social Security_ER and Medicare_ER.
5. Select Save.
6. Verify that the employee's payroll is now correct.