August 24, 2009 PeopleSoft Payroll Tax Update 09-D – Release 9
PeopleSoft Payroll for North AmericaTax Update 09-DTax Update Notes - Release 9
PeopleSoft Payroll’s Tax Update 09-D includes updates to U.S. tax and garnishment tables, COBOL program and store statement changes, and re-delivered SQRs for U.S. and Canadian payroll reporting. These tax update notes include:
· Instructions for updating your system’s tables and a summary of the table changes
· A list of COBOL program and store statement changes
· A summary of the SQRs delivered with this tax update
· An appendix of object changes delivered with this tax update
For Release 9, the tax update package also includes the following documentation files:
Resolution_766829.xls / List of object changes delivered with Tax Update 09-D
UPD766829_CODECHANGES.rtf / PS Print Project Report for Release 9
You must follow the instructions in the UPDxxxxxx_INSTALL.htm document to apply the object changes listed in the Resolution_xxxxxx.xls spreadsheet before applying the COBOL and store statement changes, running the DataMover scripts, or using the SQRs delivered in this tax update. Before applying Tax Update 09-D, you must apply all previous tax updates.
Unless otherwise indicated by a specific posting date, Report IDs referenced in these tax update notes have not been posted to MetaLink 3.
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Updating Your Tables
Tax Update 09-D includes the following files for updating the tables in your PeopleSoft Payroll system.
File / Contentsupd766829_01.dat
upd766829_01.dms
/ U.S. tax table updates
upd766829_02.dat
upd766829_02.dms
(U.S. only)
/ Tax Form Definition Table and Tax Form Print Parameters entries and related XMLP values for Form W-2c (Rev. 2-2009)
(Report ID 1861503000)
upd766829_03.dms / Database stamp
(There is no .dat file associated with this .dms file.)
upd766829_04.dat
upd766829_04.dms
/ Strings table
upd766829_05.dat
upd766829_05.dms
(U.S. only) / 2008 Tax Form Definition Table entries
DO NOT RUN THIS SCRIPT UNLESS THIS IS THE FIRST YEAR FOR YEAR-END PROCESSING WITH PEOPLESOFT PAYROLL
(Report ID 1910866000)
upd766829_06.dat
upd766829_06.dms
/ Garnishment table updates
upd766829_msg.dat
upd766829_msg_i.dms
/ Message catalog
Both U.S. and Canadian customers should apply the garnishment, database stamp, strings table, and message catalog updates.
The DataMover script (.dms) files identify the input data file (.dat) as well as the output log message file. The directory where DataMover looks for the input data file and the log file is specified in your Configuration Manager.
Any new-insert DataMover entries in these tax update scripts which have key values matching rows already in your database will not be applied. This condition could occur if you have already added any of the new table entries included in this tax update script on your own, such as a tax change, which was posted to MetaLink 3.
Special Note – North America
Potential Problem - Deleting Orphan File Attachments
A potential problem has been identified in Release 9.0 for Payroll for North America customers. The PeopleTools Utility delivered for deleting orphan file attachments will wipe out all file attachments used for generating W-2/W-2C and/or T4/T4A year-end forms.
The following information is from Enterprise PeopleTools 8.49 PeopleBook: System and Server Administration > Using PeopleTools Utilities:
Remove Orphan File Attachments from Database
An accumulation of file attachments can consume a significant chunk of disk space. On a regular basis, you should make sure that lingering, or orphaned, file attachments are deleted from the database. Click the Delete Orphan File Attachments button to complete this task. This button invokes the CleanAttachments PeopleCode function.
Navigation to this Utility is via PeopleTools > Utilities > Administration > Copy File Attachments
What do you need to do?
Do NOT use the Delete Orphan File Attachments pushbutton on the Copy File Archive page.
Development is working on providing guidance for those customers who have the need to use this functionality. We are tracking this issue under Report ID 1868095000.
This information has also been posted as an announcement on MetaLink 3 under Document ID 815937.1.
Special Note – Preparing for U.S. Year End Reporting 2009
If 2009 will be your first year producing Form W-2 using PeopleSoft Payroll . . .
If 2009 will be your first year producing Form W-2 for U.S. employees using PeopleSoft Payroll, you must run the special script delivered with this Tax Update 09-D that will prepare your Tax Form Definition Table for 2009 year-end processing.
For Release 9 this Data Mover script is upd766829_05.dms.
Running this script will ensure that your Tax Form Definition Table is current up through 2008 year-end changes and ready for upcoming 2009 year-end changes to be delivered in future tax updates.
If you produced Form W-2 for 2008 using PeopleSoft Payroll . . .
Employers who completed year end processing and produced Form W-2 for tax year 2008 using PeopleSoft Payroll should not run the DataMover script upd766829_05.dms.
(Report ID 1910866000)
Special Note – U.S. - Year End Tax Forms
Beginning with year end reporting for tax year 2009, PeopleSoft Payroll for North America will discontinue support for the continuous-feed impact printer version of each of the tax forms listed below.
Payroll for North America
Form ID
/ R R Donnelly
Form Number
W-2
/
Wage and Tax Statement /
IMP01 /
PS2114M
W-2c
/
Corrected Wage and Tax Statement /
IMP01
(Discontinued with the delivery of Tax Update 09-D – see note below.)
/
PS8606862-A
1099-R
/
Distributions from Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc.
/
2VERTICAL /
PS9923M
Support for the continuous-feed impact printer version of Form 1042-S (Foreign Person’s U.S. Source Income Subject to Withholding) was discontinued beginning with year end reporting for tax year 2008.
Note: This tax update delivers product modifications to support the most recent Internal Revenue Service revision of Form W-2c (Rev. 2-2009).
Impact printer versions of the new Form W-2c are not supported. The new Form W-2c is supported for making only laser-print and XMLP Form W-2c corrections to U.S., American Samoa, Guam, and U.S. Virgin Islands W-2 forms.
Note: RR Donnelly has updated their website with information on year-end tax forms for 2009:
http://www.rrdonnelley.com/wwwPeopleSoft/home.asp
Special Note – U.S.
International ACH Transactions
Beginning September 18, 2009, changes to the NACHA Operating Rules requires the identification of any electronic banking transaction that involves funds transmitted to or received from a financial agency outside the territorial jurisdiction of the United States, in order to comply with reporting requirements mandated by the U.S. Office of Foreign Assets Control (OFAC). This type of electronic banking transaction is referred to as an International ACH Transaction (IAT). In files of electronic financial transactions such as those generated by payroll departments containing direct deposit of payments to employees or retirees, special formatting of International ACH Transactions is required. Detailed information on the new requirements is available in this publication available from NACHA/The Electronic Payments Association on their website at http://pubs.nacha.org/risk.html
International ACH Transactions (IAT) Survival Guide: Implementation, Best Practices & Technical Specifications
The product modifications delivered in Tax Update 09-D are designed to correctly create IAT records in the example given as Scenario F-3 on pages 96-97 of the International ACH Transactions (IAT) Survival Guide, which describes payments by direct deposit to a U.S. bank to a person who resides outside of the United States, by an employer who does not know whether or not the funds will be ultimately transferred to a financial institution outside the United States. In the example, the employer chooses to “err on the side of caution and code the transaction as an IAT entry to ensure its compliance with OFAC sanctions policies.”
The product modifications described on the following pages are delivered in Tax Update 09-D to enable employers to flag a direct deposit payment to an employee or retiree as an International ACH Transaction in the circumstances described in Scenario F-3 on pages 96-97 of the International ACH Transactions (IAT) Survival Guide. Records for deposits flagged as International ACH Transactions will then subsequently be formatted as IATs in the deposit file created by DDP001.SQR according to the file format record specifications published for Scenario F-3 in the International ACH Transactions (IAT) Survival Guide.
Direct Deposit page (Administrator View) BEFORE Tax Update 09-D changes:
Direct Deposit page (Administrator View) AFTER Tax Update 09-D changes:
After reviewing Scenario F-3 on pages 96-97 of the International ACH Transactions Survival Guide, employers who have reason to believe that they have employees or retirees whose current direct deposits to U.S. bank accounts are actually an intermediate step in the transfer of funds to a financial institution outside the jurisdiction of the United States may check the International ACH Bank checkbox on the Direct Deposit page to flag the deposit as an International ACH Transaction in the file of direct deposit transactions created by DDP001.SQR.
Direct Deposit page (Employee Self-Service View) BEFORE Tax Update 09-D changes:
Direct Deposit page (Employee Self-Service View) AFTER Tax Update 09-D changes:
The new International ACH Bank checkbox added to the Source Bank Accounts page as shown below is reserved for future use and should not be used until further notice.
Source Bank Accounts page BEFORE Tax Update 09-D changes:
Source Bank Accounts page AFTER Tax Update 09-D changes:
(Report ID 1790678000)
Special Note – U.S.
State Withholding Tax Reciprocity for
Connecticut Residents Working in Other States
Tax Update 09-D delivers modifications to program PSPTCALC.CBL to correctly calculate the amount of Connecticut state income tax to be withheld from Connecticut residents working in other states other than Connecticut. The change in the Connecticut tax calculation is illustrated with the following 2009 withholding calculation example:
A biweekly-paid Connecticut resident claiming a status of married (Connecticut withholding code “C”) with zero withholding allowances in all jurisdictions is paid total taxable wages of $1,902.90:
$ 761.16 taxable wages paid for work in New York (40%)
$ 1,141.74 taxable wages paid for work in Connecticut (60%)
$ 1,902.90 total taxable wages
The State Tax Reciprocity Table rule used for Connecticut residents working in other states is:
“Calculate residence state and work state withholding separately on work state wages. Withhold 100% of calculated work state withholding. Withhold calculated residence state tax on work state wages to the extent that calculated residence state withholding exceeds calculated work state withholding.”
Prior to the modifications, using this reciprocity rule, the Connecticut state tax withholding for the above example was calculated as follows:
$ 0.00 calculated CT tax on $ 761.16 biweekly wages paid for work in NY
$ 20.16 less calculated NY tax on $ 761.16 biweekly wages paid for work in NY
0.00 = no credit to be given against total CT resident tax calculation because NY tax paid on the wages earned in NY exceeds the calculated CT tax on the same wages
$ 31.83 CT resident tax calculation on $1,902.90 total wages paid
$ 0.00 less credit for CT tax in excess of NY tax on NY wages
$ 31.83 = total CT tax withheld from employee
The above calculation followed this instruction currently published by the Connecticut Department of Revenue Services (DRS) on their website:
http://www.ct.gov/drs/cwp/view.asp?a=1462&q=266294
“The employer will withhold tax for the state in which the individual works and will submit the tax to that state. If the employer is also registered to withhold Connecticut income tax, Connecticut income tax must be withheld by the employer, but only to the extent that Connecticut income tax withholding exceeds the amount required to be withheld for the state in which the services are performed.”