Set Up an Employee Garnishment

1. From the File menu, select Payroll Formulas, then choose User-Maintained. Sage 50 displays the User-Maintained Payroll Formulas window.
2. Enter a formula ID (for example, GARNISH).
3. Enter a tax name using the NAME[space]YEAR rule. For example, enter GARNISH 11, where 11 is the payroll tax year (2011).
4. Classify this formula as a Deduction.
5. Leave Filing Status at All. Clear the Use this formula as a filter on the Payroll Tax report check box.

6. In the Formula box, enter the following:

   "The following garnishment formula takes the adjusted gross and subtracts the standard taxed deductions of Fed_Income, Soc_Sec, Medicare, and State. It calculates 30% of the resulting net amount."

   ANSWER=-(ADJUSTED_GROSS+Fed_Income+Soc_Sec+Medicare+State)*.30

   The above formula is based on the defaulted Sage 50 payroll setup. It assumes that you have set up in Employee Default Information the payroll fields Fed_Income, Soc_Sec, Medicare, and State. If you have a local tax, the payroll field corresponding to it needs to be added to the formula. Normally this is Local. If you modified the name of these payroll fields, you will have to alter the formula to include the correct payroll fields (taxed deductions only). Your formula needs to reflect something similar to the following:

   ANSWER=-(ADJUSTED_GROSS+EE PAYROLL FIELD 1+EE PAYROLL FIELD 2+EE PAYROLL FIELD 3+. . .)*.30

   The sentence within quotes above the actual formula is meant as a comment or reminder of how the calculation is set up. Adding the comment is optional.

7. Save the tax table and close the window.

1. From the Maintain menu, select Default Information and choose Employees. Sage 50 displays the Employee Defaults window.
2. Select the Employee Fields tab.

3. On a blank line, enter Garnish as the name of the new payroll field.

   Note: What you enter here will print on employee paycheck stubs in the deduction area.

4. Enter or select a G/L account (liability) associated with the garnishment. To display a list of existing accounts, type ? in this field or select the Lookup button. To add a new account, type + or double-click the field, which displays the Maintain Chart of Accounts window.
5. Click the Calculate button.
6. Select the GARNISH formula that we set up in Step 1.
7. Select OK to save the new payroll field.

Typically garnishment only applies to one or a few employees. So you should only apply the formula to them.

1. From the Maintain menu, select Employees/Sales Reps. Sage 50 displays the Maintain Employees/Sales Reps window.
2. Select an employee whose wages are to be garnished. To display a list of existing employees, type ? in the Employee ID field, or select the Lookup button.
3. Select the Employee Fields tab.
4. For the Garnish payroll field, clear the Use Defaults check box and select the Calculated check box.

5. Next, enter the tax name that was set up in the previous step (GARNISH).

   This is neither a Memo nor Run field, so skip to the Adjust button.

6. Select the Adjust button to set the Adjusted Gross for this field. Sage 50 displays the Calculate Adjusted Gross window.

   In most cases, Gross is the only payroll field necessary for calculating garnishments. Check with your accountant if you are not sure about your situation.

7. Make sure the Gross check box is selected, then click OK.
8. Save the employee record, and close the window.