Payroll: States With Special Tax Factors

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Some states, for example Alabama, require special additional factors for the Tax Library. These factors, known to Keystone as TAXPARAM1 and TAXPARAM2 can be setup in Tax Code Maintenance and/or as factors in the Payroll Formula Setup.

States with known additional factors

  1. AL
  2. AZ
  3. LA
  4. MS

Tax Code Maintenance Setup

Plug the needed factors 1 and 2. Do not specify the rate type.

Alabama

  • TAXPARAM1: Set to 100 for employees to take the personal exemption
  • TAXPARAM2: Set to 1 for married employees to assume Married Joint. Otherwise the tax will default to Married Separate, resulting in a much higher tax.

Mississippi

1. Add TAXPARAM1 to STATE_TAX formula

2. Enter the total annual amount of exemptions. For example enter $1,700.00 as 17000000

Louisiana

TAXPARAM1 should be set as follows:

  • 0 = no personal exemption
  • 10000 = one personal exemption
  • 20000 = two personal exemptions
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