Wage Accumulation Rules for Vertex

Vertex refers to wage accumulation rules as jurisdictional interaction treatments (JITs).

If you have a Payroll installation, to successfully process payroll, you must have Vertex installed.

Note: For further info, see Country Extension Options for the US in the Help Center.

These tables reference how the Vertex JIT codes correlate to the payroll process wage accumulation rules.

State Wage Accumulation Rules

Payroll process rule	Vertex JIT code	Vertex rule	What it does
Use default behavior	Default	Use default behavior.	Executes the default behavior. For further info, see Calculation Guide for the United States Vertex Payroll Tax Q Series.
Credit resident tax by work tax, always accumulate wages	2	Credit resident tax by work tax, always accumulate wages.	First calculates the resident tax, then reduces the tax by the amount of work tax withheld. Always accumulates wages for the residence, even if resident tax is 0.
Credit resident tax by work tax, accumulate wages if taxed	3	Credit resident tax by work tax, accumulate wages if taxed.	First calculates the resident tax, then reduces the tax by the amount of work tax withheld. Only accumulates wages if there is a tax withheld.
No resident tax if work tax greater than zero, always accrue	4	No resident tax if work tax greater than zero, always accrue.	Does not withhold residence taxes if there is a work tax, but it always accumulates wages.
No resident tax if work tax greater than zero	5	Eliminate the residence tax if the work tax is greater than 0. Accumulate wages only if tax is withheld.	Does not withhold residence taxes if there is a work tax, and it only accumulates wages if there is a resident withholding.
No resident tax if work tax on nonresident, always accrue	6	No resident tax if work tax on nonresident, always accrue.	Does not withhold residence taxes if there is a work state tax. Accumulates wages for the residence.
No resident tax if work tax on nonresident, accrue if taxed	7	No resident tax if work tax on nonresident, accrue if taxed.	Does not withhold residence taxes if there is a work state tax. Accumulate wages only when there is a tax withheld.
No resident tax if work or residence location mismatch, accrue if taxed	8	Calculate work taxes only.	Calculates work tax only, and disregards resident tax.
Calculate tax independent of all other jurisdictions	99	Calculate tax independent of all other jurisdictions.	Calculates resident tax independent of work tax.

Local Wage Accumulation Rules

Payroll process rule	Vertex JIT code	Vertex rule	What it does
Use default behavior	Default	Use Default behavior.	Executes the default behavior. For further info, see Calculation Guide for the United States Vertex Payroll Tax Q Series.
Credit resident tax by work tax, always accumulate wages	2	Credit resident tax by work tax, always accumulate wages.	First calculates the resident tax, then reduces the tax by the amount of work tax withheld. Always accumulates wages for the residence, even if resident tax is 0.
Credit resident tax by work tax, accumulate wages if taxed	3	Credit resident tax by work tax, accumulate wages if taxed.	First calculates the resident tax, then reduces the tax by the amount of work tax withheld. Accumulates wages only if there is a tax withheld.
No resident tax if work or residence location mismatch, accrue if taxed	8	Calculate work taxes only.	Calculates work tax only, and disregards resident tax.
Calculate tax independent of all other jurisdictions	99	Calculate tax independent of all other jurisdictions.	Calculates resident tax independent of work tax.

Note: Refer to the appropriate Tax Summary sections of the Calculation Guide for the United States Vertex Payroll Tax Q Series for the default values of each state and locality.