Maryland residents working in Delaware

This topic explains how to set up Sage 100 Contractor so that Maryland taxes can be computed for employees who live in Maryland and work in Delaware. Maryland residents working in Delaware need to have both Delaware and Maryland taxes calculated on the Delaware earnings. Following are the setup requirements:

• State Income Tax calculations must be set up for both MD (Maryland) and DE (Delaware) in 5-3-1 Payroll Calculations.
• A locality must be set up for Maryland with the State set to MD, and a second locality for Delaware with the State set to DE in menu 5-3-6 Local Payroll Tax.
• Each employee must have the table number representing the county they live in entered in the Table# cell of the employees Maryland State calculation on the Calculations tab in 5-2-1 Employees. (See links)
• The State represented on the payroll record should be the employee residence—MD (Maryland).
• Employees’ timecard lines must be entered with the appropriate localities depending on where they worked during the pay period. If they are salaried, they must have one line for each locality, and the total hours must be applied to each line.

Note: When a payroll record lists MD as the State, and the timecard line(s) contains localities that have DE as their Tax State, an additional amount of Maryland state tax will be computed along with the normal Delaware state tax. Sage 100 Contractor calculates Maryland tax using the “Maryland Residents Working in Delaware” table published by the state of Maryland.