Tuesday, March 4, 2014

Delete Deductions? Um, Not So Fast.

Did you know you can delete a deduction assigned to an employee even if there is activity for that deduction?   As long as the activity is in a prior year, and the year end close for Payroll has been completed, Dynamics GP will allow you to delete the code from Cards-Payroll-Deduction.

Well, that sounds like an easy way to clean up your deduction list?  Just delete the ones that are no longer in use (they can't have any current year activity).  However, it is important to note that removing a deduction that was tax sheltered can cause issues.  The two that I have come across:

1.  Your 941 for prior years will be incorrect, as it will no longer have the deduction's TSA settings to refer to when calculating the taxable wages.
2.  There is no reliable method for determining the tax settings for the deduction once it has been deleted, so it becomes difficult to reconcile anything for the prior year.

Of course, both of these items are not an issue if you have completed your reconciliations and no further questions come up.  But if you are concerned about potentially having to revisit your filings and/or reconciliations for the prior year-- it is better to inactivate the deduction rather than delete it (even if there is no current year activity).

Christina Phillips is a Microsoft Certified Trainer and Dynamics GP Certified Professional. She is a senior managing consultant with BKD Technologies, providing training, support, and project management services to new and existing Microsoft Dynamics customers. This blog represents her views only, not those of her employer.

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