Payroll - State Withholding deducted when not selected

[tborgal]

I have run into an interesting problem while trying to resolve a payroll issue. I have found that the State withholding is being calculated whether box 16 in the Maintain Item Descriptions is checked or not. As long as a Tax Schedule is selected the tax is calculated, in fact I just found out that this happens on all selections for wages ( boxes 1,3,5 and 16). The only way to stop the deduction is to check the Taxable Income as NO. But this is no good because 403b and Housing Allowance are subject to FICA and Medicare but not Income Tax on State and Federal. Am I missing something here or is this a bug??? The calculation is the same whether the box is checked or not.

Using V10.4 with the latest Maint. Release on an XP system.

[Justine Loker]

This may help you set up your payroll. I'm not sure what you are asking but this helped us when we set up our payroll.

http://www.powerchurch.com/support/answ ... icle_id=17

[tborgal]

OK I get it. The check boxes in the W2 information part of the Maintain item descriptions is for the proper placement of this information on the W2's not for whether it will be calculated as taxable income. All income is considered taxable unless you mark it as non-taxable or you list the amount as Exempt/Yr.

Thanks for clearing this up for me.

[jordan2k510]

I have read the PC link for setting up 403b for a W2 employee. Our pastor is self employed. We deduct 6% of his salary and housing allowance and match it at 3%. Can I set up his 403b as described in the PC link?