How Do I Begin the new year in Payroll?

 The Freight.Ware employee payroll system, will tell you the current date is ‘outside the range of the current GL year’ when you run it for the first time in 2011. Follow these steps:

Create a new payroll year

1. Enter the Freight.Ware payroll system
2. Click OK to continue
3. Click Cancel in the Select Year & Date window
4. Click on the Utilities tab
5. Click on the Create New Year option
6. Select 2011 in the first box
7. Select 2010 in the second box
8. Leave the Active Employees option marked unless you have an inactive employee who will return in the future, then mark All Employees
9. Click Create - OK - Done
10. Now select the Change Payroll Year/Date option
11. Select 2011 in the first box
12. Enter today’s date in the second box
13. Click OK

Your new payroll year is now created, next you need to update your Federal Tax Tables.

Enter your new 2011 tax tables - Each year, the Federal Tax Tables must be reset to withhold the new tax rates. These tax rates can easily be changed. Follow these steps:

1. Enter the Freight.Ware payroll system
2. Select the Taxes tab
3. Select the Employee Tax Tables option
4. At the top of the screen, at the Select Tax: prompt, select Federal Income Tax - Married
5. Change the Exemptions Amount to $3,700.00
6. Click on the Tax Tables tab
7. Change the table entries to make the screen look like this (Figure 1)

8. At the top of the screen, at the Select Tax: prompt, select Federal Income Tax - Single
9. Change the Exemptions Amount to $3,700.00
10. Click on the Tax Tables tab
11. Change the table entries to make the screen look like this (Figure 2)

12. At the top of the screen, at the Select Tax: prompt, select FICA Social Security
13. Click on the Tax Tables tab
14. Change the table entries to make the screen look like this (Figure 3)

Note - As a result of the Tax Relief, Unemployment Insurance Reauthorization and Job creation Act of 2010 the Employee Social Security Tax rate has been reduced to 4.2%. This applies only to the employee withholding portion. The employer social security rate remains at 6.2%. FreightWare payroll expects the employee and employer rates to be the same and will give a warning message when calculating your payroll after this change. The calculations however are correct. Please pass through the message and complete the processing of your payroll as usual. We will be issuing an upgrade to correct the warning message in January 2011.

There are no changes to the Employer Social Security wage limits or rates. There are also no changes to the Medicare wage limits or rates for employer or employee.

Your payroll system is now reflecting the new 2011 federal tax rates. Have your state or local payroll tax rates changed? If so, these rates will also need to be updated. Please contact us if you need assistance.