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reverse payroll

Yes I have taken over the accounting for a small business and am trying to come up with "actual" payroll numbers from checks. I know there are w/h and SS/MC tax (7.65%) components, but when I try to "unroll" the actual payroll number (they don't have the hours worked data, hard drive crash), it becomes difficult because thw w/h changes a few dollars if I just use the formula...

gross pay = w/h of (net pay) + (net pay)/(1-.0765)

When I plug the numbers back in the w/h might be off a few bucks. Any help would be appreciated!

- mark

Reply to
Mark Enriquez
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"Mark Enriquez" wrote

The only thing your running up against is the program rounding for the tax withholding

If the net + income tax is divided by 92.35% it gives you gross. Enter that gross into a dozen different payroll programs and you'll get a dozen different tax withholding amounts.

See if you can edit the tax withholdings to get them back to your formula amount.

If on the other hand your payroll software is set to withhold at a certain percentage, and you know that amount, you can compute that amount and therefore the multiplier.

20% federal withholding 6% state withholding 7.65 FICA

33.65%

division factor is 66.35% of net

$700 net check is a gross pay of $1055.01

Gross = $1055.01 Social - 65.41 Medi - 15.30 Federal - 211.00 State - 63.30

--------------------- Net of + $700.00

Reply to
Paul Thomas, CPA

"Paul Thomas, CPA" wrote in news:DaT0g.2934$ snipped-for-privacy@bignews6.bellsouth.net:

Paul,

I see your point...what I am trying to do is make sure the IRS is happy, and, as you know, they require to-the-penny reconciliation between the

941s and W-2s. This business has not yet filed 4th quarter 941, but DID issue W-2s, so therein lies the problem.

If I remember correctly, the end of IRS pub 15 (tax tables) contains formulae for calculating w/h?that in conjunction with your explanation should get me to where I need to be. Thanks!

Reply to
Mark Enriquez

Ok.. might be a silly question.. but where are the payroll registers for the checks that were written? Were they written by service company, ADP, Intuit? Can they replace them for you?

Reply to
TKnTexas

"Mark Enriquez" wrote

They can be pissed off as long as the payroll is as correct as you can make it.

It's no problem to make it balance. You will just have to tweak the federal and state withholdings to make it balance.

Hopefully.

Reply to
Paul Thomas, CPA

In the UK most payroll programs have a "net to gross" facility. If a client has their own software that doesn't have this facility I have kept altering the gross until the amounts were as I wanted to the penny.

Reply to
Peter Saxton

Peter Saxton wrote in news: snipped-for-privacy@4ax.com:

Well, this is how I ended up doing it...in Pub 15 there is a formula section that breaks down w/h like this...

Single Bi-Week 1 witholding...

if (PAYgross - 126.92) is GREATER than 385 w/h = 28.30 + 0.15(PAYgross - 126.92) ELSE if (PAYgross - 126.92) is GREATER than 102 AND LESS than 385 w/h = 0.10*(PAYgross - 126.92) ELSE w/h = 0

...by using formula...

PAYnet = w/h + PAYgross*0.0765

...with the correct formula lets me solve for PAYgross = PAYnet/

Works Great!

- mark

Reply to
Mark Enriquez

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