- In Configuration, Benefits, create a non-cash benefit.
- On the Benefit tab, select the Withholding Setting of Do not withhold tax or report, or Not subject to for all federal, state, and local taxes.
- Save and close the Benefit record.
- In Records, Employees, open the employee record and select Employee, Add Historic Entry from menu bar.
- On the historic entry screen, enter a period ending date and pay date within the calendar year of the W-2.
- Select the bank account and payment method, and enter the check number.
Note: The bank information is needed to create a Do Not Post transaction to record the adjustment on the employee Activity tab; the transaction is not recorded in the bank register. Because the historic entry transaction has a status of Do Not Post, it will not affect General Ledger accounts.
- In the Payment Details section, highlight Benefits, select the benefit created in step 1, and enter an amount of $0.00.
- Highlight Taxes, select the state tax ID, and enter the amount to adjust.
- Enter a positive number to increase tax withholding
- Enter a negative number to decrease tax withholding
For example, if the current box amount is $500 and it should be $600, you would enter $100 in the Amount field or if the current box amount is $600 and it should be $500, you would enter ($100) in the Amount field.
- Save and close the Historic Entry.
- Run the Adjusted Gross Wage Report to verify the change.
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