Is it too early to talk about year-end payroll processing?

By Posted August 6th, 2013

It’s summer here in the US and while we should all be enjoying our vacations and time with family, those of us who work with payroll know that the end of summer means year-end payroll processing is just around the corner. I hate to be a downer, but in the spirit of back-to-school commercials and fall clothing displays in stores, I’m going to look at what lies ahead for payroll professionals as the weather turns cooler and the calendar dwindles.

I’m part of a great team of SAP HR/Payroll professionals at SpinifexIT who spend our days (and many nights!) working on ways to make processes like year-end faster and easier. So, at the risk of spoiling the end of summer for my US payroll friends and colleagues, this blog post is about year-end payroll processing (sorry!). The good news is, this post is also about how Easy Balance can help.

For those who are not familiar with it, Easy Balance is a solution that streamlines US payroll year-end processing by removing many of the manual processes that occur when dealing with items such as W-2 production, validation of data and general exception reporting.  Utilizing your existing SAP standard configuration, Easy Balance is designed to be an “out-of-the-box” solution that will simplify processing for many of these difficult payroll year-end tasks.

One of the many processes delivered with Easy Balance is reporting that enables you to check the configuration of your wage types for tax purposes. Let’s walk through how easy it is to run a report that checks configuration for /7nn wage types:

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To run this report in Easy Balance (this is done right inside your own SAP system in real-time), you first select a date for report selection.  I chose ‘Today’ to run for the current date.

On the Additional Selections Tab, you can select the USA Tax Type that you wish to verify.  In my example, since I’m checking the wage types that are set up to cumulate into the /701 (Federal), I selected the option USA Tax Type 01.  Leaving the USA Tax Wage type values blank will evaluate all existing wage types for configuration.  (If you prefer to check setup on wage types being created throughout the year, you can enter those wage types in the USA Tax Wage type selections to verify only those wage types.)

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Click to view larger image

The output from my example shows the entries that cumulate into Box 01 and Box 16 of the W-2 after executing the report with the options shown above.  Each wage type appears on a separate line and all of the tax authorities appear across the top.  This report quickly shows you if the wage type will be valid for the tax authority for the box shown.   If the wage type is configured for /701 you will see “Yes” in the column cell value.   If the wage type is not configured for /701, the column cell value will be blank.

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In the above case, all of the Wage Types displayed cumulate into Box 01 for Federal – as you can see the value of “Yes” in the FED column cells.  NOTE: Box 01 of the W-2 will only reflect FED wages per configuration.  Box 16 of the W-2 will contain the state wages applicable for employees.

Since the /701 wage types also make up the amounts in Box 16 of the W-2 (for the state tax authorities), you will also see the wage type mapping for state tax authorities in this report as shown below:

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Click to view larger image

As you can see in my report output, this report shows that box 16 has not been fully configured for all states for wage types 1300 and 1301. This information will immediately give your IT or Payroll configuration teams insight into necessary updates and corrections to ensure accurate year-end processes. Using this pre-delivered report, you will receive details on state tax configuration automatically when you select tax type 01 in the selection screen. It is not necessary to specify other tax types in order to review the state configuration.

This is one of just many ways that Easy Balance can help you prepare for and ensure a smooth payroll year-end. We will be sharing more tips and examples of how Easy Balance can help you in the coming weeks, but since the clock is ticking toward year-end, if you want to learn more about Easy Balance, email me and let me know. I would love to show you more in a one-on-one demo!

Until next time, sorry for putting a damper on the end of your summer, but the good news is SpinifexIT’s Easy Balance can help make your year-end faster and easier!