California Bonus and Stock Option Payments
California taxes the withholding rates on bonus and stock option payments at a different supplemental withholding rate than other earnings.
To support employees that earn these kinds of payments, you need to perform some additional configuration.
What you need to do |
How you do it |
---|---|
Deploy the Element Information extensible flexfield |
Use the Extensible Flexfields task. |
Set the alternate rate on your Supplemental Earnings element |
Use the Elements task. |
The following sections describe these steps in detail.
Element Information Extensible Flexfield
Before you can create or modify Supplemental Earning elements, you must deploy the Element Information extensible flexfield.
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Start the Extensible Flexfields task.
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Search for the
pay%element%
flexfield code. -
Select the search result, and click Deploy Flexfield.
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Click Done.
You can override the supplemental tax method only for supplemental earnings configured as Process separately, but pay with other earning. California is the only state available for selection.
Supplemental Earnings Elements
To set the alternate rate on a Supplemental Earnings element:
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Start the Elements task.
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Create the element, using the Supplemental Earnings primary classification and Bonus secondary classification.
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Complete and save the element.
In addition to saving the element, the task creates multiple indirect elements to support it.
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Restart the Elements task, and search for the element you just created, using a wildcard at the end of the name.
This returns the element and all associated indirect elements.
For example, for an element named "CA Supplemental Bonus", you might use a string of
CA Supp%
. -
Select and edit the Calculator indirect element.
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On Element Details, in Element Information EFF, expand Calculation Method.
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Enter the following.
Field name
What you enter
State
CA
Supplemental Tax Method
Alternate Flat Rate
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Click Done.