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
Things to do before setting up deductions
• 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?
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 Codes
Within 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 taken
Sheltered From Yes means to subtract this deduction before calculating
taxes
Sheltered From No means do not subtract this deduction before
calculating taxes
Deduction Code - Sheltered From
Standard Non-sheltered
Deduction
Cafeteria Plan
Sheltered Deduction
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.
Deduction Code – Cafeteria Plan
Primary elements of cafeteria plan deductions
Classification 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 - Amount Type & Default Flat Amount
Two Amount Types
01 - Flat Amount
02 - Percentage
This is the amount PER PAY PERIOD
If the deducted amount is the same for
everyone, a default flat amount may be entered
Leave 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)
Deduction Code Control – For Employer Matching
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 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.
Automatic Employer Matching - Calculation
Employee Deduction
Deduction Control File
Amt Deducted
Subtracted from
Employer
Expense
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 – Employer pays Total Premium
Subtracted from
Employer
Expense
If deduction is paid in full by employer
Set up a default flat amount to zero in
order to calculate the employer’s 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.
GL Entries – using Employer matching
WHEN WRITING CHECKS
No Expenditure accounts are used on
checks to the insurance company,
ONLY Debit Liability accounts once
Automatic Matching is implemented
Deduction Premium Changes
Reports, Control, Control A-J, Deduction Code Summary
Print the Deduction Code Summary Report before making any changes
Deduction Premium Changes
Reports, Payroll, Emps/Itm A-L, Deduction Code
Print the Employees Per
Deduction Report before
making any changes
From this
To this
If amount is deducted twice a
month, the amounts would
be half
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
Deduction Premium Changes
Reprint Deduction Code Summary Report to confirm changes made to
Deduction Control
Various Ways to Change Employee
Deduction Amounts
• Deduction Maintenance through Payroll Master
• Deduction Scroll
• Auto Update
Deduction Scroll
Other, Deduction Scroll
Deduction Scroll
Other, Deduction Scroll
Update (F4) scrolls to next person
with that deduction
To this
From this
Deduction Scroll
Other, Deduction Scroll
If chose All Employees or
Only Employees Without
Deduction
Auto Update
Other, Update, Auto Update, Deduction Amount/Percent
Defaulted in
from deduction
control
Enter in the
amount to
match the
control
Deduction Premium Changes
Reports, Payroll, Emps/Itm A-L, Deduction Code
RE-Print Employees Per
Deduction Report to
confirm changes
Before
After
W-2 Reporting
• 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 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 EmployerSponsored 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
www.localgovernmentcorporation.com