In order to setup 401K you need to define two payroll categories. One for the Employer portion of 401K and one for Employee portion.
Setting up 401K for Employee Contribution
To set up 401K contributions for your employees create a deduction payroll category under Setup > Payroll Settings > Payroll Categories. Click on add (+) button and select deduction from the list of options. Complete the Basic Information under the General Tab. Also, under the Deduct before window federal and State income taxes flags should be checked.
For the Type choose Formula and then click on the Formula button that appears. Use the Payroll category button to add the all of the Earnings categories that can be used in the 401K calculation (Salary, Hourly Wages, Overtime, Vacation Pay etc.). If the contribution is the same for all employees then you can enter it here as a percentage. If the contribution rate is determined at the employee level you can enter it here as 100% but set the appropriate rate on the employees’ master paycard.
Under the Form assignment tab assign the payroll category to Box 12 on W2 and under sub box choose option D. See the figure below.
If any limit need to be applied then enter the amount in the Advanced tab.
Once the payroll category setup is complete proceed to employee master paycard to set the individual contribution rate under the deduction tab. Depending on how the payroll category was setup you enter appropriate rate in the factor field. If the category was set as standard percentage for all enter 100 here. If the rate is to be set individually then enter the employee’s contribution rate here.
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Paymate Support (Second Level)
In order to setup 401K you need to define two payroll categories. One for the Employer portion of 401K and one for Employee portion.
Setting up 401K for Employee Contribution
To set up 401K contributions for your employees create a deduction payroll category under Setup > Payroll Settings > Payroll Categories. Click on add (+) button and select deduction from the list of options. Complete the Basic Information under the General Tab. Also, under the Deduct before window federal and State income taxes flags should be checked.
For the Type choose Formula and then click on the Formula button that appears. Use the Payroll category button to add the all of the Earnings categories that can be used in the 401K calculation (Salary, Hourly Wages, Overtime, Vacation Pay etc.). If the contribution is the same for all employees then you can enter it here as a percentage. If the contribution rate is determined at the employee level you can enter it here as 100% but set the appropriate rate on the employees’ master paycard.
Under the Form assignment tab assign the payroll category to Box 12 on W2 and under sub box choose option D. See the figure below.
If any limit need to be applied then enter the amount in the Advanced tab.
Once the payroll category setup is complete proceed to employee master paycard to set the individual contribution rate under the deduction tab. Depending on how the payroll category was setup you enter appropriate rate in the factor field. If the category was set as standard percentage for all enter 100 here. If the rate is to be set individually then enter the employee’s contribution rate here.
Also enter the amount in the Maximum cell.