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Employer Setup – Screen 5Multi-State Setup

Multi-State Setup

Overview #

This knowledge base article provides detailed information on setting up multi-state operations within ProPay, our comprehensive payroll software. This feature is essential for employers operating in more than one state, allowing for accurate tax calculations and reporting across multiple jurisdictions.

Key Features #

  • Support for up to four additional states beyond the home state
  • State-specific tax ID and rate management
  • Customizable tax deposit frequencies
  • Special handling for State Disability Insurance (SDI) scenarios

Enabling Multi-State Setup #

  1. Navigate to the Employer Setup screen.
  2. Locate the “Multi State Setup” checkbox.
  3. Check the box to enable multi-state features.
  4. The screen will expand, allowing entry of additional state information.

Required Information for Each State #

State Withholding Tax and Unemployment ID Numbers #

  • Enter the employer’s identification numbers assigned by state agencies.
  • Important: Always request a copy of Federal, State, and Local tax IDs from your client. Do not accept tax ID numbers verbally or over the phone to avoid costly errors.

STWT and UI Tax Deposit Frequencies #

Select the appropriate deposit frequency for each state:

  • (S) = Semi-Weekly Tax Deposits
  • (M) = Monthly Tax Deposits
  • (Q) = Quarterly Tax Deposits
  • (4) = Qtr-Monthly Tax Deposits
  • (8) = Eighth Monthly Tax Deposits
  • (3-5) = 3 or 5 day depositors (e.g., New York State)
  • (N) = Not Applicable

Note: It’s recommended to obtain a copy of the official letter from the government agency to ensure accuracy.

Employer SUI Rate #

Enter the State Unemployment Insurance rate assigned annually to the employer by the state.

Training Rate #

Some states assign a training rate (also known as WORK-FORCE or RE-EMPLOYMENT rate) to certain employers. Enter this rate if applicable.

State Disability Insurance (SDI) Settings #

Employer’s SDI Tax #

  • Check this box only if you are certain the employer pays the SDI Tax.
  • In most states, SDI tax is paid by the employee, and this box should remain unchecked.
  • The SDI rate is pre-programmed in ProPay for states that require it.

Employer SDI Exemption #

  • Check the “Check If Employer Is Exempt From SDI” box if all employees of this employer are exempt from State Disability Insurance Taxes.
  • This only applies to states that are automatically subject to SDI taxes.

Employer SDI Contribution Rate #

  • Enter the employer’s SDI contribution rate if applicable.
  • If employees are subject to SDI tax but the employer is exempt, enter a NEGATIVE Employer SDI Contribution Rate.

Tax Payment Method #

State ACH Credit Payments #

  • Check this box to impound the employer’s state withholding and unemployment taxes into a separate checking account.
  • Set up the checking account in SYSTEM SETUP, TAX IMPOUNDS SETUP.
  • ProPay will send payments electronically for states that accept them. Otherwise, the payroll processor can print individual checks for each employer.

PIN Number #

Enter the State PIN number (if applicable) for employers participating in State electronic tax payments using the ACH CREDIT method.

Additional Settings #

  • Draft Days: Enter the number of days to draft the employer’s account before the pay date, or enter zero if not applicable.
  • Business Closure Date: Click the box and enter the date your client closed their business or stopped paying wages, if applicable.

Troubleshooting #

If you encounter issues with multi-state setup:

  1. Verify all tax ID numbers are entered correctly.
  2. Ensure deposit frequencies are up-to-date with the latest state assignments.
  3. Double-check SDI settings, especially for states with unique requirements.
  4. Confirm ACH Credit Payment settings if electronic payments are not processing correctly.

For further assistance, please consult our help menu within the ProPay software or visit our website at https://www.Paysoft.com.

Feedback #

We value your input! If you have suggestions for improving this documentation or encounter any issues not addressed here, please contact our support team through the ProPay software or our website.