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State Taxes - Distribution Tab

Access this tab using Maintain>Payroll>State Taxes.

Use this tab to specify how to distribute State Unemployment Taxes only if paid by the Employer. Choose to have state unemployment amounts distributed the same way the employee's earnings are distributed; limit distribution to the earnings used to calculate the state tax; or distribute State Unemployment Taxes using a specific Distribution Code selected on this tab.

 

Distribution of the Employer-Paid State Unemployment Tax Expense Should: Select one of the three options (Follow Earnings on Timesheet, Follow Earnings Used to Calculate the Tax, or Use Distribution Code) for the system to distribute the accounting entry for the employer paid SUTA. If Use Distribution Code is selected, enter an existing Distribution Code or select one from the drop-down list. Click Distribution Codes Information to open the Maintain>Payroll>Distribution Codes form, where you can create or modify a distribution code. Each time this button is selected, a new Distribution Codes form is opened.

  • Many grants and contracts allow State Unemployment Taxes to be charged directly to the funding source. In this case, choose Follow Earnings on Timesheet or Follow Earnings Used to Calculate the Tax. The State Unemployment Taxes are distributed to the same Account Codes (Fund and any other account segments except General Ledger) as the employee's earnings. In other words, the Distribution Codes used to distribute the employee's earnings are also used to distribute the State Unemployment Tax. If more than one Distribution Code is used to distribute the employee's earnings, the State Unemployment Taxes are distributed based upon a weighted average of the distributed earnings. (State Withholding is not an expense of the employer and therefore does not require allocation.)
  • If there are more funding sources to which you do not distribute State Unemployment Taxes (because you may have a negotiated rate or State Unemployment Taxes are simply disallowed), choose the Use Distribution Code distribution method. For this method, specify the exact Distribution Code to distribute the State Unemployment Taxes, which may be entirely or partially distributed to overhead. If a Distribution Code is specified on this tab, it must be an existing Distribution Code.