Updated Payroll Tax Liability Formula for Dynamics GP

February 14 | By Tracey Brinkman

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By Ryan McBee


Prior to the latest Payroll Update for Great Plains, you could do an audit check of the Payroll Tax Liability GP calculation by simply taking Federal Tax Withholding + Fica Medicare Withholding times 2 + Fica SSN times 2.  As you probably know by now, the Employers portion of FICA is 6.2% and the Employers portion has been reduced to 4.2%.

However, I have had a number of clients contact me and say this formula is no longer applicable and have asked for a revised formula.  The new formula is described below and ties out to a sample Payroll Run using Fabrikam.

Reprint Check Register

As you can see from above, the prior formula is not applicable and the new audit check is as follows;

Federal Tax WH    $              6,655.17  
Employee Medicare    $                 408.47  
Employees SS    $              1,746.54  
Employer Medicare    $                 408.47  
Employer SS    $              1,746.55 (FICA Owned – FICA   Medicare WH)
Total Tax Liability    $            10,965.20  

I have talked with Microsoft and at this time, they have no intent on modifying the report to split out the employer (6.2%) and employee (4.2%) FICA portions.