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Microsoft Dynamics SL Fed9 - Additional Medicare Taxes for Earnings over Government Specified Limits Calculates Incorrectly

Last Modified Wednesday, February 26, 2014
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​Causes of FED9 - Additional Medicare taxes calculating incorrectly and a workaround.

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Symptoms

Fed9, additional Medicare taxes for earnings over government specified limits, incorrectly calculates.

Cause

SL annualizes wages. That causes a large, one-time check to assume that the annual wages are greater than the defined limit and to calculated a fed9, Additional Medicare deduction amount, even though the wages are below the defined wage limit.

A second factor in a wrong calculation is when calculations look at the gross Fed6 Medicare wages without considering any pretax exemptions like 401k or insurance.

Resolution

To change the Fed9 setup, follow these steps:

1. Open Deduction Maintenance (02.290.00).

2. In Deduction ID, type Fed9.

3 . Change the Min Ytd subject base and Max Ytd subject base both to 0.00

4. On the Exemptions/Credits tab on an empty line, Press F4 to switch to form view.

5. Set up a new exemption.

Marital Status= All Statuses
Type Exemption= Exemption
Exemption/Credit ID = Fed6
Description= Fed6 subjwages
Base Type = Deduction Amount
Base Deduction ID = Fed6
Calculation Method= Fixed Percent
Fixed Pct/Rate/Amt= 6896.5517
Annual Minimum=0
Annual Maximum = 200000
Maximum calculation = As Calculated
Reduce reported wages box is selected

6. Click Save. 

Note: Fixed % of 6896.5517 is calculated as 1/0.0145 = 68.96551724 converted to a % = 6896.5517  to back into the Fed6 subjwages.

7. Set up any pretax exemptions for Fed9 the same as you have set up for fed 6 such as for 401k or insurance.

https://mbsauthor.partners.extranet.microsoft.com/sites/CSSL/northamerica/Support/Pages/Msdslfed9ht.aspx
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Microsoft Dynamics SL