Don’t Process That First Payroll For 2011 Just Yet!

The procedures for processing your first MAS 90 or MAS 200 payroll in 2011 have changed due to the social security tax rate decrease that goes into effect on January 1, 2011.

The social security tax rate is being reduced from 6.2% to 4.2% for employees (the employer portion is still 6.2%) for 2011.  The social security tax wage base limit also remains unchanged at $106,800.  Both the employee and employer Medicare tax rates remain unchanged at 1.45%.  For more details, click here.  According to the IRS, employers technically have until January 31, 2011 to implement the new rate.  However, I doubt many employees will want to wait that long.  By using the procedures detailed below, you can start using the new tax tables on your first 2011 payroll.

In the past, MAS payroll users have simply copied their live payroll company to a backup company and closed the year in the live company to start processing payroll for the new year.  The new tax tables were not installed until after the W-2’s were printed.  The reason behind not installing the new tables until after W-2 printing is that MAS 90 and MAS 200 use global tax tables.  In other words, all companies within MAS share the same tax tables.  Installing the new tax tables before printing W-2’s would change the social security tax wage base limit for employees who exceeded the limit resulting in incorrect Social Security wages on the W-2’s.

Since the social security tax rate has changed, you can no longer wait to install the new tax tables.  Regina Gutcher, a Sage Customer Support Specialist, has outlined the steps for running a 2011 payroll before printing the 2010 W-2’s:

  1. Backup all payroll data.
  2. Create a new company code in Company Maintenance.
  3. In the new company, copy the Payroll, Common Information, General Ledger and Job Cost (if integrated) from your live company.
  4. Process payroll year-end for the live company.
  5. Install the 2011 tax tables.
  6. Process payroll for the live company for 2011.
  7. Before printing W-2’s, install the 2010 tax tables.
  8. Print the W-2’s from the new company created in step 3.
  9. Reinstall the 2011 tax tables.

If you need assistance with these steps, please contact either Amy ( or John (

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