Round 5 Tax Code Update – HIRE Act

If your are struggling with installation of the Round 5 Tax Code Update for Microsoft Dynamics GP payroll, there is an additional wrinkle you probably have not realized.  The documentation for the update anticipates that you will have installed the tax code udate prior to any payroll runs in July (July being the start of 3rd quarter reporting).  The documentatiton instructs you to run the report for the 2nd quarter only.  If you had payroll runs in July (3rd quarter) before you install the Round 5 Tax Code you have FICA amounts posted to the general ledger that should be adjusted.

 If you did have payroll runs in July, it is important to run the Payroll Tax Adjustment Report (HIRE) for the third quarter to identify FICA amounts that you will have to back out of your general ledger.  Another word of caution.  Be sure to run the Payroll Tax Report after installing the Round 5 Tax Code, but before you run any more payrolls in July.  The report will list all FICA amounts for the ENTIRE quarter so it is important to understand under what conditions you are running the report.

The HIRE Act actually went into effect on March 19, 2010.  If you had HIRE Act qualified employees for the period 3/19/2010 to 3/31/2010, then you should determine the general ledger adjustments for FICA wages by reviewing historical payroll posting journals, and again make the necessary adjustments to FICA expense and liability. Running the Payroll Tax Adjustment Report will list all FICA wages for HIRE Act qualified employess for the ENTIRE 1st quarter.

I don’t want to sound unkind, but there must be an easier way to encourage employers to hire new employees.

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