Define Legal Entities for the US

To add a legal entity to your organization, you first define it using the Legal Entities task in your implementation project.

You define separate legal entities for employees and retirees.

Defining legal entities includes doing the following.

Want you want to do	How you do it
Before you begin	Make sure you have: Defined the legal address for your enterprise using the Legal Addresses task. Set up your legislative data group (LDG) using the Legislative Data Groups task. Or, it's automatically created when you define your first legal entity.
Create your legal entities	Use the Legal Entities task. If you're using the legal entity in an HCM context, designate it as a legal employer. HCM implementations require legal employers. If you're using it in a payroll context, designate it as a payroll statutory unit (PSU) for payroll processing and tax reporting. Limit your organization to one PSU for employees and one for retirees. This helps you: Control how the payroll process calculates limit taxes. Control overtime calculations between multiple TRUs. For further info, see Implementing Payroll Overtime Rates for the United States on the Help Center. Track deferred compensation contribution limits. For further info, see Contribution Limits for Deferred Compensation Plans in the Help Center. Issue pension payments to retirees. For further info, see Oracle Cloud Human Capital Management for the United States: Payroll and HR Implementation and Use for Retirees (2461709.1) on My Oracle Support. You can define a legal entity that's both a legal employer and a PSU. To group multiple legal employers together for tax reporting purposes, assign them to the same parent PSU. If your legal employers represent different companies, assign them to separate PSUs. There are no predefined legal entities. You must create all legal entities that apply to your enterprise.
Identify the LDG	Confirm the correct LDG is associated with your PSUs.
Configure your legal entities for HR reporting and payroll processing	After creating the legal entities, use the Legal Entity HCM Information task to configure them for the following. Equal Employment Opportunity (EEO) reporting New Hire reporting Veterans' Employment & Training Service (VETS) reporting Payroll processing Third-party tax filing
Configure your legal entities and PSUs for retirees	If you have retirees in your organization, you must create separate legal entities and PSUs for them. Don't assign both employees and retirees to the same PSUs or to the same legal employers.
Define organization calculation cards for your legal entities	Use the Legal Entity Calculation Cards task from your implementation project.

For further info on these steps, see the following sections.

For info about Oracle Fusion Human Capital Management for the United States documents, see the United States Information Center (2063588.2) on My Oracle Support.

Before You Begin

Be sure you have already defined any associated legal addresses through the Legal Addresses task.

Consider defining your US LDG before identifying your legal entities as PSUs. If you don't, the Legal Entities task automatically creates the LDG for you and associates it with the PSU.

If you have already defined a US LDG, you can manually associate it with the PSU.

How You Create Legal Entities

To create a legal entity:

Start the Legal Entities task from your implementation project, and click Create.
On the Create Legal Entity page, provide the name, identifier, and country.
If you don't designate this legal entity as a PSU, assign an existing PSU to it. Choose one from the Payroll Statutory Unit field.
Provide any other required info.
Click Save and Close.

How to Identify the LDG

To view the LDG associated with a PSU:

From My Client Groups, click Workforce Structures.
Click Manage Legal Entity HCM Information.
Search for the PSU or legal entity.
Select PSU. This displays general info for the PSU, including the LDG.
If the LDG hasn't automatically been associated, select one from the menu.

How to Configure Your Legal Entities

Your legal entities require some configuration before you can perform HR reporting and payroll processing.

Note: Electronic year-end and quarterly filings processes aren't available in Oracle Fusion HCM. You must perform these filings through the US Third-Party Tax Filing interfaces. For further info, see Oracle Cloud HCM for the US: Third-Party Tax Filing Interface document (1594079.1) on My Oracle Support.

To enter this info:

From My Client Groups, click Workforce Structures.
Click Manage Legal Entity HCM Information.
Search for and choose the legal entity you want to modify.
If the legal entity is a legal employer:
1. Select Legal Employer.
2. In the left pane, click Legal Employer Details and enter the necessary values in the Work Day Information and Legal Employer Information sections.
  
  For retiree legal entities, select the 2 Tier - Multiple Assignment employment model.
3. Click Federal, and define the EEO, New Hire, and VETS reporting rules.
4. Enter the company identifier.
5. Indicate if the company employs more than 100 employees in a pay period.
6. Indicate if the employer is a government contractor.
7. In New Hire Reporting Rules, associate a default tax reporting unit (TRU) to a legal employer. Select one in the TRU for the New Hire Report field.
  
  HR reports use the employer federal employer identification number (EIN), registered name, contact details, and registration details of the TRU associated with the legal employer.
8. In VETS Reporting Rules, enter the reporting name, parent company, company number, and type of reporting organization.
9. In EEO and VETS Reporting Information, choose the employment categories you want to exclude from the reports.
  
  Note: Selecting a value in Exclude Assignment Category results in that category being excluded from EEO and VETS reporting.
10. Select the Single or Multiple establishment employer type.
11. Identify whether your legal entity is affiliated with an enterprise of 100 or more employees.
12. In United States Reporting Entity Data, identify each legal employer as either a parent or child.
13. In EEO and VETS Assignment Category, choose the assignment categories to include or exclude from the EEO-1 report.
If the legal entity is also a PSU:
1. Select PSU. This tab lists the associated PSU, including the LDG.
2. Enter the fiscal year start date.
3. Select Federal, and enter any additional info to support electronic year-end filings for the US.
Click Submit.

The details you specify apply to all legal reporting units (LRUs) associated with the PSU.

Note: The TRU you select in the New Hire Reporting Rules requires additional EEO and VETS reporting info. Use the Legal Reporting Unit HCM Information task to set these values for the TRU in the EEO and VETS Reporting Rules region. For further info, see the Legal Entities for the US topic in the Help Center.

Define Organization Calculation Cards

To define a calculation card for a legal entity:

Start the Legal Entity Calculation Cards task from your implementation project.
On the Payroll Statutory Unit page, click Create.
Provide an effective date, and select Calculation Rules for Tax Reporting and Payroll Statutory Unit.
Click Continue.
Define the federal income tax (FIT) calculation rules for the card.
1. Select the appropriate row under Calculation Components.
2. Enter the appropriate data in Calculation Component Details, including the applicable employer self-adjustment method.
3. Repeat to add calculation rules for Social Security, Medicare, and federal unemployment tax (FUTA).
4. Click Save.
Create regional calculation rules for the card.
1. Select Regional in Calculation Card Overview.
2. Under the Actions menu, select Create.
3. Select the appropriate state, and click OK.
4. Select State Unemployment in Calculation Components.
5. In Calculation Component Details of the State Income Tax: Details section, click Add Row.
6. Select State Unemployment Organization Information, and click OK.
7. Select the self-adjustment method.
  
  For further info, see Self-Adjustment Methods for Tax Withholding in the Help Center.
8. To define state unemployment (SUI) employer experience rates for your PSU, select Enterable Calculation Values on Calculation Cards and click Create.
9. Repeat these steps to enter the self-adjustment method for state disability.
10. Define any appropriate courtesy tax withholding rules.
  
  For further info, see Oracle Cloud HCM for the US: Courtesy Tax Implementation (2138998.1) on My Oracle Support.

The settings you make on subordinate LRU calculation cards override values on this card.