Create and Edit Taxability Override Sets

Creating and editing taxability override sets is a two-part process. First, you must create the taxability override set. Next, you must edit the taxability override set to include and configure the tax jurisdiction or jurisdictions to override.

Role feature access: Payroll Setup > Payroll Setup > Earnings and Deductions > Taxability Override Sets

Before You Begin: Customers must consult their Support teams to determine if a Taxability Override Set is allowed. During implementation, you must review all taxability codes before creating a new taxability override set. If none of the existing taxability codes fulfill your requirements, submit an inquiry to the Compliance queue for review.

Create a Taxability Override Set

To create a taxability override set: 

1. Go to Payroll Setup > Earnings and Deductions.
2. Click the Taxability Override Sets tab.
3. Click Add and select the Taxability Type or Taxation Method that you want to create the override taxability for from the drop-down list.
   • For deductions, select one of these taxation methods:
     • 409A N.Q. DEF COMP FICA FUTA TAXABLE P030 - 409AVested (Vested 409A Non-Qualified Deferred Compensation Plan)
     • 409A N.Q. DEFERRED COMPENSATION P029 - 409ANonVested (Unvested Non-Qualified 409A Deferred Compensation)
   • For earnings, select one of the taxability types:
     • INCOME UNDER SECTION 409A E051 - NQ409A (Non-Qualified Def Comp - 409A (no Risk of Forfeiture))
     • 409ANQDC Plan Failure – Txbl FIT E097 – 409ANQDCPlanFailureTxblFIT (Non-Qualified Deferred Compensation Plan that fails to comply with IRC Section 409A)
4. In the Name field, enter a name for the taxability override set.
5. In the Reference Code field, enter a unique reference code (XREF) for the taxability override set
6. (Optional) Enter a description for the taxability override set.
7. Click Save.

Edit a Taxability Override Set

Note: The two available deductions have both an Employee Taxation Method and Employer Taxation Method available, while the available earnings only have the Employee Taxation Method available.

To edit a taxability set that you have created:

1. In the navigation panel at the left side of the screen, select the taxability override set that you created. This loads the main screen with all of the available tax jurisdictions and the current taxability as supported by the application.
2. In the Taxability section, select the tax jurisdiction or jurisdictions you want to override by clicking the corresponding checkboxes on the left side of the grid. You can use the filter to locate specific jurisdictions.
3. Once you have selected one or more jurisdictions, click Edit Taxation Method, which loads the Edit Taxation Method dialog box.
4. Enter the effective start date for the change and then the specific employee and employer taxation overrides that are required. The effective start date must be equal to or greater than today’s date. Past-dated changes aren’t supported.
5. Click OK to save changes and return to the Taxability Override Sets tab.
6. Click Save.