Working with 5-Payroll > 5-3 Payroll Management > 5-3-1 Payroll Calculations > About payroll calculations > About tax tables for setting up federal and state tax calculations

About tax tables for setting up federal and state tax calculations

Sage 100 Contractor contains the tax tables necessary for computing federal and state income taxes. For each state you work in, create a payroll calculation for state income tax. The calculation is necessary to maintain the correct gross wage totals for each employee, and to ensure accurate state quarterly reports, state tax reports, and W-2 forms.

Important!

Although some states do not have state income tax, state income tax calculations must be set up:

 

If you work in a state that does not levy an income tax, you still need to create a payroll calculation. For those states, a tax is not calculated, but Sage 100 Contractor stores the state wage for state reports. In addition, some calculations use the state wage to compute additional deductions such as state unemployment or disability. For those types of calculations, it is important to select the State Income Tax check box. Otherwise, the payroll calculation may not compute the deduction correctly.

For details on setting up tax calculations for specific states and municipalities, see About tax setup information.

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