Issue/Symptom/Question

How do I refund the local tax money to an employee?

Environment

Module: Payroll

Time Entry-Reimbursement

Manual Payment Adjustment

The system cannot reduce a tax to make a payment to an employee so a reimbursement should be used to refund the money
Once the payroll is complete, run a reimbursement history to see the employees that received the payback
A Manual payment adjustment can be used to reduce the tax and offset with the reimbursement so a net zero payment occurs to offset the entry
The reimbursement will charge a liability or expense account
A Payroll Adjustment account will need to be used

Steps in the Process:

Pay the money back with the reimbursement
1. PENTA books the expense
Offset the reimbursement with the Tax using the Manual Payment Adjustment process -Manual Payment Adjustment Entries to Refund Local Taxes Incorrectly Withheld
1. PENTA offsets the expense
Net impact is zero in the GL and the sub-ledger is up to date for W-2 purposes