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About payroll taxes

As part of setting up Ajera to process payroll in-house, you review and set up the taxes you need.

Federal taxes

Ajera automatically sets up federal taxes, for which you can change only the description and financial accounts.
Ajera automatically reports federal tax amounts on W-2 forms.

Note:

The Employee Medicare tax includes a 0.9 percent medical surcharge to wages in excess of $200,000, which is included on the paycheck, in the Employee Medicare tax. When employees are subject to this tax, the Employee Medicare will be greater than the Employer Medicare. The tax rate will still display as 1.45.

State and local taxes

You must set up a tax for each state, local, or other tax that you need. For example, depending on your state, you may need to set up a tax for state withholding, state disability, and state unemployment. If you use multi-company, you can set up different disability or unemployment rates for each company, if needed.

For taxes that you set up, other than State Withholding, you indicate the appropriate box for W-2 reporting when setting up the tax.

Updates to federal and state taxes

As taxing authorities change taxes and forms, we incorporate those changes into Ajera and update the software.

You can install Ajera updates when they are released. Ajera calculates the taxes on a paycheck based on the pay date of the paycheck so your taxes are accurate for the payroll you are running.

For example, if you issue a paycheck with a pay date of 12/31/11, Ajera uses the 2011 tax tables. If the paycheck has a pay date of 1/03/12, Ajera uses the 2012 tax tables.