Flexgen Payroll Deduction

Maintenance

Highlights

• Set up Payroll Deduction Controls

• Employer Sponsored Health Care Reporting

• Employer Matching and the Calculations

• Deduction General Ledger Entries

• Deduction Premium Changes

• W2 Reporting

• Gather insurance rate information for each insurance option that is available to your employees.  

Consider the following:

• How many times a year do you take the deduction for payroll?

• Does the county/city pay any portion of dental insurance or vision insurance?

• What GL liability account number do you use for each insurance?

• Do you offer sheltered and non-sheltered options?

Things to do before setting up deductions 

Setting up Payroll Deduction Codes• Reports, Control, Control A-J, Deduction Code Summary

Print the Deduction Code Summary Report before making any changes

Setting up Payroll Deduction CodesWithin the Payroll Menu Choose:-Other-Control

Within the Control Menu Choose:-Control A-L-Deduction Code

Next, we will review each field within the Payroll Deduction Screen. Note: Look Up (F2) and Help (F1) is available for each field

Deduction Code

The Deduction Code number is user defined. Assign a number not previously used

Deduction Code Description

Description should be detailed enough to distinguish each deduction from another

Deduction Code Screen Description

This abbreviated description is printed on the check stub, therefore should be meaningful to the employees

Deduction Code Classification

Select the Classification for this deduction. Health Insurance is generally a Regular Voluntary Deduction

Deduction Code Function

Enter the liability account used in posting to the GL when this deduction is taken

An “X” in CC or SOb attaches the employee’s cost center or sub object to the liability account

Deduction Code Grouping

Deductions can be grouped together on the insurance report

Deduction Code - Sheltered From

The Sheltered From indicators tell the system whether to calculate taxes before or after this deduction is takenSheltered From Yes means to subtract this deduction before calculating taxesSheltered From No means do not subtract this deduction before calculating taxes

Standard Non-sheltered Deduction

Cafeteria Plan

Sheltered Deduction

Deduction Code - Sheltered From

A little FYI…“Cafeteria plan” is named such because it is similar to a cafeteria where individuals select their food of choice, employees may choose benefits of their choice.

Primary elements of cafeteria plan deductionsClassification of Regular Vol Ded is chosen

Sheltered From indicators are normally YES (except TCRS retirement)

W2 Cafeteria Plan indicator is YES

Employee amount of cafeteria plan will be recorded as DDNTB in box 14 of the W2

Deduction Code – Cafeteria Plan

Two Amount Types

01 - Flat Amount

02 - Percentage

Deduction Code - Amount Type & Default Flat Amount

This is the amount PER PAY PERIODIf the deducted amount is the same for everyone, a default flat amount may be enteredLeave Blank if amount varies per employee

Deduction Code – Employer Sponsored Reporting

Code 34 DD in Form W-2 Box 12 is not necessary to report employer portion but is ok if you do fill it in as such

Set the Emplyr Sponsored Health Ins flag to 01 YES to report in Box 12 of the W2 as code DD (default is NO)

Amount to be deducted(per pay period)

Total Premium(per pay period)

Employer Exp(per pay period)

Obj Code used for employer expenditure

Deduction Code Control – For Employer Matching

Deduction Code Control Screen

Your final screen will look something like this. Repeat for each and every insurance option

Check with your plan provider for the correct setting on the fields: (Dependent Care; Section 457; Nonsection 457; Qualified)

Once the deduction codes are set up, you will add the deduction code to the employee deduction screen

Employee Deduction Screen

•Payroll Master

•PayInf (F9)

•Deduction

•Add (F5)

•LookUp (F2). Page Up or Down to find deduction to be linked to this employee

•Deduction Scroll is also a good way to add deductions

Consider this…If you take the steps mentioned above, your system will accumulate reporting amounts.

The system subtracts the deducted amount from the total premium amount to determine how much should be posted to the GL as the employer expense, posting to the employee’s distribution Fund, Function & Obj Code (& Cost Center & SOb if used)

Automatic Employer Matching - Calculation

Amt Deducted Subtracted from

Employer Expense

Employee DeductionDeduction Control File

If deduction is paid in full by employerSet up a default flat amount to zero in order to calculate the employer’s expense

Automatic Employer Matching – Employer pays Total Premium

Subtracted from

Employer Expense

Automatic Employer Matching - Correction

Subtracted from

Employer Share

Don’t just double the deduction amount to “catch up” a deduction

Automatic Employer Matching - Correction

Add the Deduction Twice to the employee

That way the matching calculation is done twice

GL Entries – NOT using Employer matching

Note: When NOT using automatic employer matching, the payroll system only generates posting for the employee’s portion of health insurance.

GL Entries – using Employer matching

Note: When using automatic employer matching, the payroll system allows posting for the employee, as well as, the employer portion of health insurance to the liability account. Also the employer expense account is automatically debited.

WHEN WRITING CHECKSNo Expenditure accounts are used on

checks to the insurance company, ONLY Debit Liability accounts once Automatic Matching is implemented

GL Entries – using Employer matching

Deduction Premium ChangesReports, Control, Control A-J, Deduction Code Summary

Print the Deduction Code Summary Report before making any changes

Deduction Premium ChangesReports, Payroll, Emps/Itm A-L, Deduction Code

Print the Employees Per Deduction Report before making any changes

From this

If amount is deducted twice a month, the amounts would be half

To this

Once change is made to deduction control, it does not automatically update employee deduction amount

Likewise, you cannot simply change employee’s flat amount without changing the deduction control

Reprint Deduction Code Summary Report to confirm changes made to Deduction Control

Deduction Premium Changes

Various Ways to Change Employee Deduction Amounts

• Deduction Maintenance through Payroll Master

• Deduction Scroll

• Auto Update

Deduction ScrollOther, Deduction Scroll

Deduction ScrollOther, Deduction Scroll

From this

To this

Update (F4) scrolls to next person with that deduction

Deduction ScrollOther, Deduction Scroll

If chose All Employees or Only Employees Without Deduction

Auto UpdateOther, Update, Auto Update, Deduction Amount/Percent

Defaulted in from deduction control

Enter in the amount to match the control

Deduction Premium ChangesReports, Payroll, Emps/Itm A-L, Deduction Code

RE-Print Employees Per Deduction Report to confirm changes

Before

After

• W-2 Report shows the employee ($575.38) plus employer portion ($643.76) coded with DD and will be shown in box 12 of the W-2

W-2 Reporting

W-2 Reporting• W-2 shows the employee ($575.38) plus employer portion

($643.76) coded with DD in box 12 of the W-2• The employee portion is coded with DDNTB in Box 14 if

marked Caf Plan

W-2 Reporting – Build Health Coverage File

• Build Health Coverage File – These options are only required if you have not had the deduction code control set up for employer contribution for the entire calendar year for the Employer-Sponsored health insurance and/or need to make changes to the deduction amount.

• Build by Calendar Year and selected

deduction codes. Deduction(s) must have “Emplyr Sponsored Health Ins” flag set to “Yes” on the deduction control.

W-2 Reporting – Build Health Coverage File

The amount in the Corrected Health Coverage field should be the total employEE plus employER. In this example, the employER portion is increased by $100

Any Questions?

This concludes our session on Flexgen Payroll Deduction Maintenance

Visit our website for full documentation and useful information for other applications

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