Tax Reporter Guide - 2009

U.S.
Tax Reporting Guide

for SAP Payroll Customers
Year End 2009

Table of Contents
Introduction.................................................................................................................................................................................. 4
Purpose .................................................................................................................................................................................. 4
Structure ................................................................................................................................................................................. 4
Content ................................................................................................................................................................................... 4
Implementation Considerations ............................................................................................................................................. 5
Year End 2009: Enhancements and New Developments ......................................................................................................... 6
W-2 Related Paper Forms ..................................................................................................................................................... 6
W-2c Related Paper Forms ................................................................................................................................................... 6
Puerto Rico W-2/W-2c Forms ................................................................................................................................................ 6
1099-R Related Paper Forms ................................................................................................................................................ 7
XML Reporting in U.S. Tax Reporter ..................................................................................................................................... 7
State Unemployment Insurance (SUI) Magnetic Media Reporting ...................................................................................... 7
Other Enhancements ............................................................................................................................................................. 8
Flexible Employee Sorting ..................................................................................................................................................... 8
Generation / Filling Date for W-2 Run ................................................................................................................................... 8
Post-Filling Runs .................................................................................................................................................................... 8
Automatic Employee Selection for W-2c Runs ..................................................................................................................... 8
Decimal Notations .................................................................................................................................................................. 8
PDF Forms in SAP enhancement package 4 for SAP ERP 6.0 ........................................................................................... 8
Post-Application Checks ...................................................................................................................................................... 10
Tax Reporter ............................................................................................................................................................................. 11
Definition ............................................................................................................................................................................... 11
Overview ............................................................................................................................................................................... 11
Using Tax Reporter .............................................................................................................................................................. 12
Access .................................................................................................................................................................................. 13
The Tax Reporting Process ...................................................................................................................................................... 14
Process Flow ........................................................................................................................................................................ 14
Process Description ............................................................................................................................................................. 15
Display PCL4 Details (RPCTRDU0) .................................................................................................................................... 17
Delete production PCL4 Details (RPCTRDUP) .................................................................................................................. 17
Delete test PCL4 Details (RPCTRDUT) .............................................................................................................................. 18
Fill Job Performance ............................................................................................................................................................ 18
Generating Tax Forms ......................................................................................................................................................... 19
Preparation/Generation Dates Screen ................................................................................................................................ 19
Printing Copies ..................................................................................................................................................................... 19
Menu Paths .......................................................................................................................................................................... 20
Displaying Tax Tables .......................................................................................................................................................... 20
Formatting and contents for W-2 and related forms ........................................................................................................... 21
Magnetic Media Reporting and Electronic Filing (MMREF-1) – Employee’s Suffix (Release 4.6C) ................................. 23
Customer Exits (Release 4.70 and above) ......................................................................................................................... 23
The Tax Reporter Log Manager ............................................................................................................................................... 24
Configuration ........................................................................................................................................................................ 24
Use........................................................................................................................................................................................ 24
Access .................................................................................................................................................................................. 26
User Preferences in Tax Form Generation .............................................................................................................................. 27
Use........................................................................................................................................................................................ 27
Structure ............................................................................................................................................................................... 27
Viewing and Downloading Magnetic Media ............................................................................................................................. 28
Use........................................................................................................................................................................................ 28
Customer Exits in TemSe Processing...................................................................................................................................... 29
Configuration ............................................................................................................................................................................. 30
Basic Configuration .............................................................................................................................................................. 31
Tax Reporter ......................................................................................................................................................................... 31
Tax Reporter Transaction and Spool Security .................................................................................................................... 31
Claims and Reconciliation .................................................................................................................................................... 32
Tax companies ..................................................................................................................................................................... 33
Worksites .............................................................................................................................................................................. 35
Configuring Magnetic Media ................................................................................................................................................ 36
Generic solution for reporting multiple tax authorities on the same magnetic media ........................................................ 42
Formatting Magnetic Media Data for Download .................................................................................................................. 47
Configuration: Form 1099-R ................................................................................................................................................ 48
Tax Reporter Configuration Checker ....................................................................................................................................... 50
Use........................................................................................................................................................................................ 50
U.S. Tax Reporting Guide, Year End 2009 2

Configuration ........................................................................................................................................................................ 50
Access .................................................................................................................................................................................. 51
Year-End Processing ........................................................................................................................................................... 52
Form W-2 Processing ............................................................................................................................................................... 53
Form W-2, Checkboxes ....................................................................................................................................................... 56
W-2 Related Paper Forms ................................................................................................................................................... 56
Form W-2, Employer Copy .................................................................................................................................................. 57
Generating Form W-2 and Associated Forms ......................................................................................................................... 59
Reprinting W-2 Employee Copies ............................................................................................................................................ 60
Address Changes on Form W-2 Reprints ................................................................................................................................ 61
W-2: Colorado Local Occupational Tax............................................................................................................................... 61
W-2: Commonwealth of Pennsylvania Local Services Tax ................................................................................................ 61
Forms W-2c and W-3c .............................................................................................................................................................. 62
Correction W-2 Forms .............................................................................................................................................................. 62
Generating Correction W-2 Forms ........................................................................................................................................... 63
W-2 Post-Filing ..................................................................................................................................................................... 64
Generating Forms W-2c and W-3c........................................................................................................................................... 65
Form W-2c Processing......................................................................................................................................................... 66
Printing Employee Number on W-2c ................................................................................................................................... 67
W-2c: Automatic Employee Selection Based on Employee Master Data Changes .......................................................... 67
W-2/W-2c and Related Forms – USERRA .......................................................................................................................... 68
Deactivating PCL4 Check for W-2c Runs ........................................................................................................................... 68
Forms 1099-R and 1096 ........................................................................................................................................................... 69
1099-R/1099-R Correction Processing ............................................................................................................................... 70
FUTA Tax Return (Form 940)................................................................................................................................................... 71
Employer’s Quarterly Federal Tax Return (Form 941) ............................................................................................................ 72
Quarterly Processing ................................................................................................................................................................ 73
Multiple Worksite Reporting ...................................................................................................................................................... 74
Running the Multiple Worksite Report...................................................................................................................................... 75
Automatic Override of Worksite ........................................................................................................................................... 76
Turning off Automatic Override ............................................................................................................................................ 77
Reconciling Multiple Worksite Report (MWR) and State Unemployment Insurance (SUI) totals ..................................... 78
Submitting Multiple Print Jobs for SUI Wage Reporting and Multiple Worksite Reports – State Level (MWR) ............... 79
Locality Wage Listing ................................................................................................................................................................ 80
Payroll Considerations .............................................................................................................................................................. 84
Claims Processing .................................................................................................................................................................... 85
Payroll Reconciliation Report ................................................................................................................................................... 86
Tax Form Reconciliation ........................................................................................................................................................... 87
Manual Entry Adjustments ........................................................................................................................................................ 89
The Adjustments Workbench ................................................................................................................................................... 89
Tax Reporter Payroll Constants ............................................................................................................................................... 89
Additional Resources ................................................................................................................................................................ 90

Introduction
Introduction
Purpose
The U.S. Tax Reporting Guide is published for customers who use SAP ERP Human Capital
Management (SAP ERP HCM) to perform quarterly and year-end tax reporting for their
employees. This document is intended to guide users through the major components, processes
and procedures for tax reporting in SAP Payroll.
Structure
This document is the U.S. Tax Reporting Guide for Year End 2009. As such, this document has
been designated as Version 2009. Subsequent versions of this guide will be released as
required. The guide is divided into eight sections:
1. Introduction
2. Enhancements and New Developments for Year End 2009
3. Tax Reporter
4. Configuration
5. Annual Processing
6. Quarterly Processing
7. Payroll Considerations
8. Additional Resources
Content
The U.S. Tax Reporting Guide has been published for general use by all U.S. customers of SAP
Payroll who operate at or above Release 4.6C. Unless stated otherwise, all information in this
guide applies equally to all releases at or above Release 4.6C. Whenever functionality does vary
slightly or significantly from release to release, the relevant release levels are explicitly indicated.
While this guide addresses the most significant milestones of tax reporting, it is beyond the scope
of this document to provide exhaustive instructions on every aspect of tax reporting in SAP
Payroll.

Introduction
Implementation Considerations
SAP regularly issues HR Support Packages (HRSPs) to provide U.S. customers on all
supported releases with the functionality required to perform payroll processing and reporting.
Since the introduction, in 2008, of component-level support packages called Country Legal
Changes (CLCs), customers who operate on SAP R/3 Enterprise (Release 4.70), mySAP ERP
2004 and SAP ERP 6.0 can pursue one of two options to obtain Phase I year-end legal changes
for tax year 2009.
HRSP Option
o Apply the Base HRSP delivered in October 2009.
HRSP plus CLC Option

o Apply the Synchronization HRSP delivered in June 2009.
o Then apply the CLC delivered for the U.S. country version in October 2009.
No delivery mechanism for CLCs is present at Release 4.6C (and below), so customers who
operate at these releases must pursue the HRSP option to obtain year-end legal changes.
The software changes contained in these HR Support Packages apply to Release 4.6C through
SAP R/3 Enterprise (Release 4.70), as well as for mySAP ERP 2004 and SAP ERP 6.0.
For more information …
Please refer to SAP Service Marketplace for more Tax Reporter information, including functional
changes and implementation of HRSPs. SAP Service Marketplace is located at
http://service.sap.com and can be accessed with a valid SAP Support Portal user ID and
password. While visiting SAP Service Marketplace, we recommend that you review the following
sites.
SAP ERP HCM & SAP Payroll, United States
The SAP ERP HCM & SAP Payroll, United States Web site is your central source of information
on tax reporting topics, training, development news, support, and documentation. This site is
located within SAP Service Marketplace at http://service.sap.com/hrusa.
SAP urges all customers to visit the Year End 2009 Web site located there for additional
information on Year End 2009 functionality for U.S. Tax Reporter. Review this site on a regular
basis for important SAP Notes and functional updates.
SAP Notes
To read SAP Notes, visit SAP Service Marketplace at http://service.sap.com/notes.
While visiting this area, you may search for SAP Notes by number, release, application area (for
example, PY-US-TR), or text.
HR Support Packages and Country Legal Changes
SAP Service Marketplace provides an overview of the delivery dates for all HR Support Packages
(HRSPs) that are delivered for supported releases. HR Support Packages and Country Legal
Changes (CLCs) are announced on SAP Service Marketplace at
http://service.sap.com/hrsp, while SAP Support Packages and Patches are announced
at http://service.sap.com/patches. Information on SAP Country Legal Changes is
available at http://service.sap.com/hrlegalchanges.

Enhancements and New Developments for Year End 2009
Year End 2009: Enhancements and New Developments

The following section summarizes the various enhancements, legal changes and corrections that
are delivered with U.S. Tax Reporter for Year End 2009.
W-2 Related Paper Forms

This section discusses Year End 2009 changes to original paper forms (related to Form W-2).
For Year End 2009, no new W-2 form is delivered in Tax Reporter.
For Year End 2009, in SAP ERP 6.0, Form W-3 has been modified to reflect the changes in the
Instructions section of the IRS form, per 2009 requirements.
No corresponding W-3 form has been modified for prior releases, since the standard system in
those releases does not print the accompanying instructions.
W-2c Related Paper Forms

For Year End 2009, in SAP ERP 6.0, the following two new forms are delivered to comply with
IRS format requirements for Form W-2c.
HR_F_W2C_09_EE
HR_F_W2C_09_ER
A corresponding new form, HR_F_W2C_09, has been created for mySAP ERP 2004 and all prior
releases.
Envelopes for Form W-2c have changed for Year End 2009. For additional
information, consult SAP Note 175641.
For Year End 2009, the following new W-3c form is delivered in all releases to reflect changes in
the instructions accompanying Form W-3c.
HR_F_W3C_09
Puerto Rico W-2/W-2c Forms

Tax Reporter supports the creation of Puerto Rico W-2 forms using a laser printer. Within SAP
Service Marketplace, a detailed user guide is available to discuss Form W-2 processing issues
for Puerto Rico.
The following forms have been modified for Puerto Rico for Year End 2009.
HR_F_W2_PR_LP_08 (Form W-2 for Puerto Rico for Tax Year 2009)
On September 14, 2009, this form received approval by the Forms and Publication Division of the
Department of the Treasury in the Commonwealth of Puerto Rico. A copy of the approval letter is
available on SAP Service Marketplace.
To obtain control numbers, contact the Employer and Estimated Tax Payments Application
Section no later than December 31, 2009.

HR_F_W2C_PR_LP08 (Form W-2c for Puerto Rico for Tax Year 2009)
On September 14, 2009, this form received approval by the Forms and Publication Division of the
Department of the Treasury in the Commonwealth of Puerto Rico. A copy of the approval letter is
available on SAP Service Marketplace.
To obtain control numbers, contact the Employer and Estimated Tax Payments Application
Section no later than December 31, 2009. HR_F_W2C_PR_LP08 is also used to print Duplicate
W-2 forms.
To print W-2/W-2c PR forms for previous years, you must adjust your configuration
by replacing the current alternate Puerto Rico W-2/W-2c form with the previous year
alternate form, and use the same sequence number.
1099-R Related Paper Forms

This section discusses Year End 2009 changes to original paper forms (related to Form 1099-R).
For Year End 2009, no new 1099-R form is delivered in Tax Reporter.
For Year End 2009, at SAP ERP 6.0 and above, the following new Form 1096 is delivered.
HR_F_1096_09
For Year End 2009, the following new Form 945 correction layout is delivered in all releases.
HR_F_945X
XML Reporting in U.S. Tax Reporter

In response to state tax authorities, who have increasingly adopted XML formats for the online
submission of tax and unemployment insurance data, U.S, Tax Reporter has been enhanced to
provide customers with a solution for filing data in XML. In some cases, this enhancement is
delivered to comply with tax authorities – notably, the Florida Department of Revenue and the
New Mexico Department of Workforce Solutions – that obligate employers to report
unemployment insurance data in XML. In other cases, this enhancement is provided as an
alternative (and therefore optional) reporting method – for example, for the submission of
quarterly wage reports to the California Employment Development Department.
For additional information, consult either SAP Note 1368621, or a detailed user guide that has
been published on this topic.
State Unemployment Insurance (SUI) Magnetic Media Reporting

For the State of New York, in disk/tape layout HR_F_UNEMP_NY, records 1A (Transmitter
record) and 1E (Employer Data) have been modified in accordance with the revised reporting
requirements of the authority.

Other Enhancements
Flexible Employee Sorting
In SAP ERP 6.0, via Business Add-In (BAdI) definition BADI_SORT_METHOD, a new user exit is
provided in U.S. Tax Reporter for customers who wish to sort Employee copies of W-2 forms to
meet their requirements. To avail yourself of this functionality, configure Business Add-In
BADI_SORT_METHOD accordingly. For further information, consult the corresponding user
guide, at http://service.sap.com/hrusa Documentation Business Add-Ins Guide for
U.S. Tax Reporting.
Generation / Filling Date for W-2 Run

The U.S. Tax Reporter Workbench has been modified to display the latest run as-of-date in the
Generation/Filling date tab when Form W-2 results have been overwritten completely. This
change has been performed across all releases.
Post-Filling Runs
The U.S. Tax Reporter Workbench has also been modified to generate a summary copy - that is,
a Form W-3 - during W-2 post-filing runs.
Automatic Employee Selection for W-2c Runs

Moreover, the U.S. Tax Reporter Workbench bas been modified so that the automatic employee
selection for Form W-2c occurs on the basis of tax company for name and/or Social Security
Number changes. (Previously, the standard system processed employees without regard to their
tax company.)
Decimal Notations
The U.S. Tax Reporter Workbench has been modified to support all available Decimal Notations
found among User Profile Defaults. Previously, the standard system would issue short dumps if
decimal notations other than 1,234,567.89 were specified. This change has been performed at
SAP R/3 Enterprise (Release 4.70) and above.
PDF Forms in SAP enhancement package 4 for SAP ERP 6.0

In SAP enhancement package 4 for SAP ERP 6.0, the default binding for array type fields on
some PDF forms has been changed from Normal to None. This change was performed in order
to print information correctly in these fields with bundling mode, which is active by default.
As you design custom PDF forms to fulfill the requirements of your enterprise, we strongly
recommend that you assign, in the Default Binding field displayed at center right below, the value
of None to array type TextFields, rather than the value of Normal. We recommend the value of
None for array type TextFields because the value of Normal has been determined to report
incorrect data when bundling mode is active. In SAP enhancement package 4 for SAP ERP 6.0,
bundling mode is active by default.

For example, as illustrated below for PDF form HR_F_W2_07, different FormCalc scripts are
assigned to TextField_p0006[0] and TextField_p0006[1], but the value of Normal is
assigned to both for Default Binding. In SAP enhancement package 4 for SAP ERP 6.0, the
assignment of the value of Normal for Default Binding in this scenario causes errors to occur in
the printing of addresses.
When the value of None for Default Binding is assigned to these TextFields, in SAP enhancement
package 4 for SAP ERP 6.0, no printing errors occur.

Post-Application Checks
Since changes to magnetic media formats are delivered for Year End 2009, we recommend that
you review magnetic media configuration for the formats in which you file. This action will serve to
ensure that the information you have configured (for example, contact name, contact phone
number, blocking factor, registration number, and so on) remains correct and consistent.
To this end, in Customizing for Payroll USA (PY-US), choose:
Tax Reporter Tax Form Definition Define original tax forms
While reviewing the magnetic tape structure of the applicable forms, check to see whether
modifications are necessary – for example, additional carriage returns or format substitutions,
such as disk for tape or vice versa (see SAP Note 306543 or SAP Note 305046). Also,
determine whether EBCDIC to ASCII conversions must be re-applied (see SAP Note 133613).
At mySAP ERP 2004 and all prior releases, new and modified SAPscript forms are delivered for
Year End 2009. Therefore, ensure that you do not have any copies of these forms on clients
other than 000; otherwise, you risk using obsolete formats. To this end, execute transaction SE71
in the corresponding client, then review entries for the client in the header information. The prefix
HR_F_* is assigned to all forms that are relevant for Tax Reporter.
If your enterprise operates on SAP ERP 6.0 and plans to perform year-end reporting
for tax year 2009 on this release, then you are required to employ SAP Print Forms
by Adobe, rather than SAPscript forms, for tax year 2009. For tax year 2009, no
SAPscript forms are delivered with SAP ERP 6.0.
Finally, we suggest that you run the updated configuration checker utility from within Tax
Reporter. To this end, choose the menu path Utilities Check configuration. Select the help icon
to the right of the message header for information on each warning and/or error.

Tax Reporter
Tax Reporter
Definition
Tax Reporter is the component of SAP Payroll that enables you to produce quarterly and annual
wage and tax reports for local, state, and federal tax authorities. This section provides a general
overview of the tax reporting process in SAP Payroll and describes the configuration that is
required to perform tax reporting in SAP ERP HCM. This section concludes with chapters on
year-end processing and quarterly processing.
Overview
This section provides an overview of Tax Reporter and the tax reporting process within the U.S.
Payroll component of SAP ERP HCM.
The topics addressed here include:

Using Tax Reporter
The Tax Reporting Process
The Tax Reporter Log Manager
User Preferences in Tax Form Generation
Viewing and Downloading Magnetic Media
Customer Exits in TemSe Processing

Tax Reporter
Using Tax Reporter

Tax Reporter is the component of SAP Payroll that you use to produce quarterly and annual
wage and tax reports for local, state, and federal tax authorities. Tax Reporter, as currently
delivered, can be used to produce any or all of the following forms:
Form W-2 Wage and Tax Statement
Form W-2c Corrected Wage and Tax Statement
Form 940 Employer’s Annual Federal Unemployment Tax Return
Form 941 Employer’s Quarterly Federal Tax Return
Form 941c Supporting Statement to Correct Information
Form 1099-R Distributions from Pensions, Annuities, Retirement or

Profit-Sharing Plans, IRAs, Insurance Contracts, etc.
Quarterly State Unemployment Insurance (SUI) wage reports
Quarterly Multiple Worksite Reports (MWR)
Localities Reporting (limited)
Tax Reporter also supports all transmittal forms associated with the above forms, including Forms
W-3, W-3c, 945, 1096 and 6559. Aside from Forms W-2c and 941c, Tax Reporter supports
correction forms for Form 1099-R and all SUI and MWR forms.
At the state level, Tax Reporter supports the following forms:
Puerto Rico: Forms W-2, W-2c, 940 and 941
New York: Fourth-quarter combined wage reporting
Arkansas: Reporting of exempt wages (on form AR-TX).

At the local level, Tax Reporter supports year-end magnetic media reporting requirements for a
number of local tax authorities.

Tax Reporter
Access
To access Tax Reporter from anywhere within the system, execute transaction PU19. Otherwise,
from the main U.S. Payroll menu, choose Subsequent activities Period-independent Payroll
supplement Tax Reporter.
The initial Tax Reporter screen is shown below.

Tax Reporter: The Tax Reporting Process
The Tax Reporting Process

Purpose
This process describes how Tax Reporter is used to issue wage and tax reports in compliance
with reporting requirements.
Prerequisites
You must have already run payroll for your employees and to have payroll results. Some reports
may also require specific infotypes to have been maintained.
Process Flow
The following graphic provides a technical overview of the reporting process within Tax
Reporter.

Process Description
Whenever you run Tax Reporter to produce reporting data for a tax form, two processes are
executed in the background:
First, the forms cluster (table PCL4, RELID U1) is filled by program RPCTRCU0. This program
extracts data from a number of areas, including:
Master Data
Results table RT of payroll results cluster PCL2
Manual entries from tax interface tables T5UT1 and T5UT2
Tables T51R5 and T51R1, which are populated by Third Party Remittance functionality.
Once program RPCTRCU0 has completed processing, the raw data that is to be reported on
paper and magnetic media forms is stored in forms cluster PCL4, in an unformatted state. Once
all necessary table entries have been created in the forms cluster, program RPCTRCU0 ceases
processing and a second program, RPCTRPU0, is run to read these entries. It subsequently
formats these entries and generates reporting data in the various media supported by Tax
Reporter, both on paper, SAPscript forms, HRFORMULA reports, or simple lists) and magnetic
media (TemSe – that is, temporary sequential – files, magnetic tape, and diskette).
Given the background processes described above, it is important for you to consider
which of the selections you make from the initial Tax Reporter screen influence the
population of forms cluster PCL4, and which of the selections influence the output of
reporting data.
Whenever you first access Tax Reporter, you can see a series of tax forms, such as Form 1099-
R, Form W-2c, State Unemployment Insurance (SUI) forms, or Form 941c. Within Tax Reporter,
these tax forms are grouped into tax form classes. Tax form classes are further grouped by
quarterly or annual reporting frequency into "original" forms (for example, Form W-2) and
"correction" forms (for example, Form W-2c). To view a complete list of tax form classes, in
Customizing for Payroll USA (PY-US), choose:
Tax Reporter Tax Form Definition Custom Forms Create user-defined tax form
classes
For all original (that is, non-correction) forms, the population of forms cluster PCL4 is controlled
by the selection of tax form class only. In other words, no jurisdictional or other selections can be
made to narrow the scope of processing for original (that is, non-correction) form data. This
means that even if you instruct Tax Reporter to produce SUI forms for only six states, forms
cluster PCL4 will always be populated for every state where corresponding payroll results exist,
regardless of the six states that you specified in the detail selection screen. Of course, the detail
selections that you make will restrict the output of original form data to the six states specified.
Nonetheless, processing of original form data will occur for every state where payroll results
exist. Once you have run Tax Reporter for a given tax form class, you can produce original forms
in that tax form class for any state, even if you did not specify that state on the detail selection
screen. To produce tax forms after completion of a Tax Reporter run, select the Print copies
function on the Tax Reporter initial screen.

Tax Reporter can process multiple tax companies during a single reporting run by means of a
transmitting tax company. Since most states and the federal government allow SUI and W-2
data to be filed on a single magnetic media file (tape or disk) for multiple tax companies, Tax
Reporter creates separate records or sub-totals for each tax company processed, but totals all
data to be submitted in a single "transmitting" tax company. The transmitting tax company is
usually the one from which the tape is created; it is also the company that will serve as a liaison
to tax authorities. Tax companies are assigned to a transmitting tax company via feature UTXTM.
To configure feature UTXTM, in Customizing for Payroll USA (PY-US), choose Tax Reporter
Define transmitting tax company. Once you have configured feature UTXTM, you execute Tax
Reporter for the transmitting tax company only; the output of Tax Reporter will include data for all
of the tax companies assigned to the transmitting tax company.
In an effort to fill forms cluster PCL4 and produce output in the shortest period possible, Tax
Reporter employs the scheduling program RPCTRSU0. Program RPCTRSU0 executes one or
more instances of cluster fill program RPCTRCU0 and print program RPCTRPU0 in order to
divide the size of the reporting run.
One instance of RPCTRCU0 is called for each tax company, or tax company split, (whose data
is being processed under the transmitting tax company), and one instance of RPCTRPU0 is
called for each type of output being processed. Therefore, program RPCTRCU0 is run per tax
company (or tax company split), while program RPCTRPU0 runs on the basis of the output type
(for example, SAPscript form or TemSe file) and sort criteria. Any selection criteria you may
specify will not influence the division of reporting runs.
See the Fill job performance section of this document for more specific information regarding
Tax Company splits.
If one or more Fill Jobs (RPCTRCU0) is terminated, you can either resume the previous run or
overwrite it with a new run. Tax Reporter checks the number of employees whose records have
already been processed and written to the PCL4 database and gives you the option of processing
the remaining number of employees or of running Tax Reporter again for all employees, as
shown in the example below:

Display PCL4 Details (RPCTRDU0)

To display Tax Reporter form cluster (PCL4) details, use program RPCTRDU0 as follows.
1. Execute transaction PU19 to access this program.
2. Specify the corresponding tax company and reporting period.
3. Select Utilities Display form fields.
4. Enter your selection criteria. You can display form cluster (PCL4) results by Form
number (from control information), Tax Company, Personnel number, or Output
produced by, (that is, the user who produced the data).
If you enter no selection criteria, Tax Reporter will select all employees.
5. Specify whether a test or productive run is to be performed.
6. Select Execute.
Delete production PCL4 Details (RPCTRDUP)

To delete Tax Reporter form cluster (PCL4) production run details, use program RPCTRDUP as
follows.
3. Select Utilities Delete Production PCL4 Data (for production runs).
4. Enter your selection criteria. You can delete form cluster (PCL4) results for production
runs by Form number (form control information) and Tax Company.
5. Select Execute.
When you delete PCL4 entries for production runs, the corresponding control information
in tables T5UXX and T5UXY also will be deleted. A control number may be used for more
than one Form number (in Tax Reporter control tables). Therefore, if a control number
that is assigned to the Form number to be deleted was also assigned to other form
numbers, then this control number information from T5UXY will not be deleted. These
details will be displayed in the program results.
However, if all Form numbers that were assigned to this particular control number were
deleted, then the control information in table T5UXY for the control number will be
deleted automatically as the last dependent Form number is deleted.

Delete test PCL4 Details (RPCTRDUT)

To delete Tax Reporter form cluster (PCL4) test run details, use program RPCTRDUP as follows:
3. Select Utilities Delete Test PCL4 Data (for test runs).
4. Enter your selection criteria. You can delete form cluster (PCL4) results for test runs by
Form number (form control information), Tax Company and Output produced by.
5. Select Execute.
For security reasons, users can only display or delete Tax Reporter data, if they have
authorization for report RPCTRDU0.
If you wish to limit authorizations for PCL4 data deletion, you can also establish
authorizations for programs RPCTRDUP (for production data) and RPCTRDUT (for test
data).
Fill Job Performance

Run times can be very long when Tax Reporter is run for tax companies with very large numbers
of employees. To shorten run times, users can distribute among several jobs the total number of
employees to be processed in one tax company. This distribution can occur either by specifying
an arbitrary number of employees per job or by dividing processing for the tax company into a
specific number of jobs.
The system selects employees to be processed from the Employee Index table (T5UX1). This
table is updated with every payroll run or manual entry transaction.
Once the list of employees to be processed for one tax company is available, this list is split into
several jobs, based on the configuration of feature UTRJS. These jobs can then run in parallel,
based on the number of background work processes available in your system.
A running summary entry is kept in PCL4; each separate job can update this entry as processing
proceeds. However, during summary updates, the PCL4 summary entry is locked to prevent
other processes from accessing it.
If your enterprise is executing Tax Reporter for the first time to perform reporting,
then we urge you to note that although the Employee Index table (T5UX1) is
populated with every payroll run, it is nonetheless advisable for new customers to
populate this table by running the utility program RPCTRUU6. This action ensures
that employees who were terminated before the first payroll is run in the standard
system will be included in the Tax Reporter run.
In SAP ERP 6.0, print jobs can be split into several smaller jobs to improve the performance of
U.S. Tax Reporter, based on the configuration of feature UTRPS. This split is intended only for

Employee and Employer copies of W-2 Forms in PDF format. Refer to the corresponding feature
documentation for additional information.
Generating Tax Forms

To generate wage and tax data and to issue the desired forms, proceed as follows:
1. Specify the transmitting tax company whose data is to be processed; if you have not
configured feature UTXTM, then each tax company will function as its own transmitting
tax company.
2. Specify the wage and tax report (for example, Form W-2) that you wish to produce, the
reporting period end date (for example, 12/31/2009) and the As of date, that is the
date up to which payroll results are to be considered – for example, 01/31/2010, if Tax
Reporter is to consider retrocalculations processed in January 2010 for tax year 2009.
You cannot perform reporting runs in production mode for individual

employees or groups thereof.
Based on your specifications, Tax Reporter extracts the appropriate data from past payroll
results. Depending upon the form chosen and your configuration, Tax Reporter issues the form
data on paper, magnetic media, or a combination of the two.
Preparation/Generation Dates Screen

The Preparation/Generation dates screen displays one entry for each tax form.
When you set the Filing date for this entry, all entries for the same form in the control table are
updated with this filing date.
However, since the system previously allowed you to define different filing dates for each run,
inconsistencies may arise with filing dates that are defined for a particular tax form that has the
same end date. Therefore, to enable users to identify these inconsistencies, the system displays
all of the entries of a form that have a different filing date.
If you attempt to change the filing date for any one of the entries (with the same end date), then
the system, in response, will revise all of the records (with the same end date) in the control table
to reflect the most recent filing date.
Printing Copies
1. Select the Print copies button on the productive run screen.
2. An information screen inquires whether you wish to print copies of the latest result with
the date of form generation specified on the screen. If you wish to print copies of prior
results, choose the menu path Tools Print copies.
The date in Date of form generation is used as the manual entry preparation date.

Menu Paths
If you have existing production runs in your system, you cannot start a production run for the
same tax form, tax company and reporting date, using the same (or later) As of date by selecting
the Online or Background buttons on the screen.
Using these buttons increases the risk of accidentally corrupting Tax Reporter data (PCL4) due to
user error, when attempting to reprint forms.
Instead, the system prompts you to use the following menu paths:
Tools Overwrite results Online production run
Tools Overwrite results Background production run
Displaying Tax Tables

To display tax table entries and input manual entries in Tax Reporter interface tables T5UT1 and
T5UT2, select the Utilities menu from the initial Tax Reporter screen.

Formatting and contents for W-2 and related forms

Form W-2, Employee Wage and Tax Statement, Copy B, C, and 2
The form W-2: employee copy complies with all requirements established by the Internal
Revenue Service (IRS) and the Social Security Administration (SSA).
SAP delivers a “4-up” substitute form; designed in accordance with IRS publication 1141, part B,
Section 2 – ‘Requirements for Substitute Forms Furnished to Employees (Copies B, C, and 2 of
Forms W-2)’. This form is intended to be printed on 8 ½" x 11" pre-perforated sheets of paper that
are blank on the front and that have filing instructions pre-printed on the back.
Review SAP Note 175641 for additional instructions and supplier contact information.
Form W-2, Authority Copy for State and Local Authorities Requiring Paper
You must file this form with state and local authorities that do not accept magnetic media, or if
you do not have enough employees to meet a minimum requirement for filing magnetic media.
The paper authority copy produced by Tax Reporter is not intended to be filed with the
SSA. In order to file with the SSA on disk, tape or online, use SAP-supplied magnetic media.
Form W-3, Transmittal of Wage and Tax Statements
The W-3 Authority copy form is based on, but does not exactly meet, IRS/SSA requirements for
Form W-3. This form is provided for reference purposes only. It would normally accompany
paper copies of W-2 Copy A, filed with the Social Security Administration. Since Tax Reporter
does not generate a paper version of Copy A that can be filed with the Social Security
Administration, Form W-3 will not be filed. Commas are no longer used in amount fields on this
form.
Form 6559, Transmitter Report and Summary of Magnetic Media
This form is based on, but does not exactly meet IRS/SSA requirements for Form 6559. The
information from the Form 6559 equivalent that Tax Reporter generates must be transcribed onto
the official form for subsequent filing. Form 6559 is only required when filing on magnetic tape or
cartridge. Commas are no longer used in amount fields on this form.
Form 6559 is not required when filing on diskette or online. If you are required to file Form 6559,
then the entry in Box.11, Number of Forms W-2 – which is actually the number of employee detail
records, not the number of paper forms – must be obtained by deriving the value from the Total
number of employees field. To do this, use the parse option within the magnetic media download
function, which is accessed via the All mag. media files function button on the main Tax Reporter
screen).
Residence/Non-residence wages/taxes
You can use Tax Reporter to report resident wages/taxes and non-resident wages/taxes. For
information about how to configure your own form to report resident and non-resident
wages/taxes, refer to the user guide entitled “Reporting Resident and Non-Resident
Wages/Taxes" on SAP Service Marketplace at http://service.sap.com/hrusa
Documentation User Guides Reporting Resident & Non-Resident Wages/Taxes.

W-2 Audit Report

The W-2 Audit Report allows you to print information for multiple employees on a single page.
You cannot use this form to file for previous tax years, although a report will be produced if
you run it for prior years. This report does not fulfill a legal requirement; it is intended to be used
as a tool for checking W-2 information prior to printing on W-2 paper stock.
W-2c Statement of Corrected Income and Tax Amounts

The configuration of the existing W-2c allows you to correct base amounts on a prior W-2c, when
more than one W-2c is issued for the same tax year. This was accomplished by changing the
value in the Way of reporting (T51T8-CORRN) field from ‘1’ – Original tax data to ‘2’ – latest
corrected data.
W-2 Related Magnetic/Electronic Filing

The MMREF-1 format for filing magnetic or electronic W-2 information with the SSA complies with
all legal requirements published by the Social Security Administration for tax year 2009.

Magnetic Media Reporting and Electronic Filing (MMREF-1) –

Employee’s Suffix (Release 4.6C)
Background
For magnetic media, the employee’s name must match the name printed on the employee’s
Social Security card. If a suffix (such as Jr.) is present, then use the provided field.
Solution
The user exit (EXIT_RPCTRCU0_004) enables you to write your own code so that you can pass
a valid suffix to Tax Reporter. In this way, you can prevent invalid suffixes from being printed.
To create/modify your user exit, execute transaction SE37, and enter the Function Module
EXIT_RPCTRCU0_004
Sample code for EXIT_RPCTRCU0_004
if ( pp0002-namzu cs 'Jr.' or
pp0002-namzu cs 'Sr.' or
pp0002-namzu cs ).
suffix = pp0002-namzu.
else.
suffix = ' '.
endif.
Flag = ‘Y’.
All MMREF-1 layouts (W-2 and SUI) now report the employee’s suffix on the RW and/or RS
records, where applicable.
For more information, see SAP Note 525173.
Customer Exits (Release 4.70 and above)

For information on customer exits in these releases, consult the corresponding user guide, at
http://service.sap.com/hrusa Documentation Business Add-Ins Guide for U.S. Tax
Reporting.


Configuration
Other than specifying the longevity of the TemSe files, no configuration is required to use the Tax
Reporter Log Manager. Since the Log Manager reports configuration errors in tandem with the
Configuration Checker, the Log Manager also helps you to resolve missing or erroneous
configuration.
Use
The Tax Reporter Log Manager is an administrative tool designed to provide an overview of
every reporting run that Tax Reporter performs.
You should check the log after every run.
As demonstrated in the following graphic, the Log Manager records both production and test
(simulation) runs for every combination of Tax Company and quarter- or year-end form that you
are filing. In the graphic, the Log Manager provides an overview of all production and simulation
runs for Form W-2 within tax company US01.
You can expand the node for the Production run into Production and Print copy
nodes, as demonstrated in the graphic above. However, the logs for existing reprint
copy runs in the system are not converted; you can still see these runs under the
Production node.

Aside from distinguishing between production, print copy and test runs, the Log Manager also
records the end date, As of date, run date, run time and user of every run performed. The first
two columns correspond to the entries that you made in the reporting period end date and
consider payroll results to fields respectively, while the remaining columns indicate the date
and time that the run was executed, and by whom. All runs are summarized in a drop-down tree
structure. For example, by opening the Production tree structure (shown in the graphic above),
you can access the run summary screen, as shown in the following graphic.
On this screen, you can review the exact End dates, As of dates, Run dates, Run times and
responsible parties (User) for each production run executed for Form W-2 in tax company US01.
The most recent run is always displayed at the top of the summary screen. From this screen, you
can usually open the tree structure still further (as shown above), to review detailed information
for any run. Alternatively, you can select the icon for an overview of the selection criteria and
control information that were used to perform the run, as well as summaries of the forms that
were produced and any errors that occurred.
Assuming that detailed information is available for a given run, so that you can open the tree
structure further, the Log Manager enables you to review additional information, if it is available,
including configuration remarks, selection criteria and output and information on adjustments.

Access
From the application toolbar of the initial Tax Reporter screen, choose the Log Manager function
button.
The Tax Reporter log is stored in a TemSe file that you can delete by using TemSe
reorganization utilities. You can specify the longevity of these records within feature TEMSE. To
access this feature, execute transaction PE03, then adjust the period accordingly.
The following example shows one possible configuration of feature TEMSE, where:
The log for tax company US01 is kept for 50 days, as a minimum; after that it will
be deleted whenever you perform routine deletions of TemSe files.
The log for tax company US02 is kept for 100 days.
The log for other tax companies is kept for 30 days.
The magnetic media generated in a production run is kept for 300 days,
The magnetic media generated in a test run is kept for 200 days.
Variable key F C Operations

OBJKN
US01 . &TEMSE=50
US02 &TEMSE=100
CTRPUT &TEMSE=200,
CTRPUP &TEMSE=300,
****** &TEMSE=30.
You can set a retention period for the Tax Reporter log at tax company level for a production as
well as for test runs. You can set a different retention period for production and test runs. You
change the configuration by changing the feature TEMSE.
The retention period for a reprint copy is equal to that of a production run.
The example below simulates feature TEMSE configuration such that, for tax company
US01, the retention period is 90 days for production runs and 60 days for test runs, while
for tax company US02, the retention period is 80 days, both for production and test runs.

D OBJKN
US01 . &TEMSE=90/60
US02 &TEMSE=80
****** &TEMSE=30.
For additional information, consult SAP Note 726356.

Tax Reporter: User Preferences in Tax Form Generation
User Preferences in Tax Form Generation

Use
The User preferences dialog box within Tax Reporter allows you to define what will appear on the
screen whenever you first execute the application. This dialog box also allows you to specify the
sort order for downloading magnetic media files.
To access the User preferences dialog box form Tax Reporter, choose Tools Preferences.
Structure
The User preferences dialog box consists of a variety of selection areas, allowing you to:
Designate the screen to be displayed whenever you run the application;
View the last screen of Tax Reporter that was accessed;
View the screen for a particular form class (for example, W-2 Processing);
Specify that the form selection tree structure is to appear in expanded format, so that all
available forms are displayed immediately upon start-up;
Specify a default sort order in which magnetic media files are downloaded;
Specify the form output selection details that are to be shown upon start-up;
Determine whether the tab strip for production runs, test runs, generation dates, or form
definitions is to appear as the active tab strip when Tax Reporter is initiated.
In mySAP ERP 2004 and SAP ERP 6.0, Tax Reporter results are displayed by
default in SAP List Viewer (ALV) format. If your enterprise performs year-end
reporting in either release, but does not wish to display results in ALV format, then
select the Disable ALV checkbox that is located in these releases within the User
preferences dialog box.

Tax Reporter: Viewing and Downloading Magnetic Media
Viewing and Downloading Magnetic Media

Use
By selecting the All mag. media files function button on the initial Tax Reporter screen, you can
display a list of magnetic media files that have been generated (in production or simulation mode)
for a particular tax form class. From the list screen, you can display the contents for a particular
file, and then download the file to a local directory.
Prerequisites
You have run Tax Reporter for the desired tax form class (for example, W-2 Processing).
Procedure
1. From the main U.S. Payroll menu, choose Subsequent activities Period-independent
Payroll supplement Tax Reporter.
2. To view magnetic media files for all tax form classes, both for production and simulation
runs, choose the All mag. media files function button.
You can also restrict your selection to magnetic media files generated for a
particular tax form class and run type (production or test) by choosing the desired
tax form class from the Tax Forms tree structure, the corresponding PROD. run
or TEST run tab strip on the main Tax Reporter screen, then the All mag. media
files function button.
3. If the Sorting order dialog box appears, specify the order in which you wish to display the
magnetic media files, then choose Continue.
If you have already defined a default sort order under User preferences, this
dialog box will not appear. For further information on this process, see User
Preferences in Tax Form Generation.
Result
A list of the magnetic media files generated in Tax Reporter is displayed according to your
selection criteria. From this screen, you can drill down to view the contents of the magnetic media
files displayed or download these files.
See also: Configuring Magnetic Media

Tax Reporter: Customer Exits in TemSe Processing
Customer Exits in TemSe Processing

If you wish to modify values for the TemSe files, you can create an exit. To do this, proceed as
follows:
1. In Customizing for Payroll USA (PY-US), choose Tax Form Definition Define original
tax forms.
2. Locate and select the TemSe form where you want to add the exit.
3. Select Magnetic tape structure.
4. Locate and select the field where you want to add the exit.
5. Select Details (F2)
6. Enter the name of your exit in the field Or directly. Your exit must start and end with $.
For example, $MYEXIT$, $PENSIONPLANID$, or $X$. To avoid syntax errors, use only
upper case letters.
7. Create an ABAP routine in the include RPCTRPUZ. The value returned from your routine
is what is sent to the TemSe file in the position indicated in Customizing, and must not
exceed 50 characters.
As shown in the example below, your user exit must use the format
form $EXITNAME$ changing value(retval).
form $PENSIONPLANID$ changing value(retval).

loop at treslt where field = 'P0001-BTRTL'.
exit.
endloop.
if sy-subrc eq 0 and t5utl-txcmp = 'US01' and
treslt-text = '0001'.
retval = 'P'.
else.
retval = ' '.
endif.
endform.
The exit above returns value P if the tax company is US01 and the personnel
subarea is 0001. Otherwise the value returned is ‘ ’ (blank).

Configuration
Configuration
This section addresses the configuration that is required for tax reporting in the U.S. Payroll
component of SAP ERP HCM.
Basic Configuration
Configuring Magnetic Media
Substituting Magnetic Media Formats: Form W-2
Substituting Magnetic Media Formats: SUI Forms
Formatting Magnetic Media Data for Download
Configuration: Form 1099-R
Tax Reporter Configuration Checker

Configuration
Basic Configuration
In this section, we describe the fundamental configuration activities that you must have
completed before you can perform tax reporting in SAP Payroll.
Tax Reporter
If your enterprise has not done so previously, then you must ensure that your system is correctly
configured to process data according to all of the configuration activities found in the Tax
Reporter section of Customizing for Payroll USA (PY-US).
In order to view the most up-to-date instructions and documentation for any
Customizing activity, always choose this menu path when you first enter any section
of Customizing:
Utilities Text display SAPscript
In addition, to view the most up-to-date documentation in its optimal format, select:
Help Settings in Modal Dialog Box
Tax Reporter Transaction and Spool Security

You can prevent unauthorized or unintentional updates of PCL4 data by configuring:
Feature UTXSS to activate or deactivate the Tax Reporter authorization check.
Feature UTXSP to specify spool authorization codes,
based on tax company and tax form class level.
Once you have activated these features, you must contact your system administrator to
create proper authorizations and assign authorizations to corresponding users.
If you wish to define authorizations on the basis of tax company, (where user group A, for
example, is authorized to run Tax Reporter for tax company US01, user group B is authorized to
run Tax Reporter for tax company US02, and so on), then you must create authorizations for
every tax company and specify all personnel areas and personnel subareas under the tax
company in Authorizations. In other words, you must specify all possible combinations under the
tax company.
Activating the Tax Reporter authorization check
To activate this authorization check, in Customizing for Payroll USA (PY-US), choose:
Tax Reporter Switch on Tax Reporter authorization check

Securing Tax Reporter spool request
To specify the necessary authorization code, in Customizing for Payroll USA (PY-US), choose:
Tax Reporter Specify authorization code for spool request
To determine which tax form class to use, in Customizing for Payroll USA (PY-US), choose:
classes
You may also refer to the authorization object documentation S_SPO_ACT in object class BC_A.

Configuration
Claims and Reconciliation

In addition to the configuration contained in the Tax Reporter section, we strongly recommend
that you also configure the entire Reporting section of Customizing for Payroll USA (PY-US).
This section consists of the following two chapters:
Reporting Claims Processing a prerequisite for clearing claims
Reporting Reconciliation a prerequisite for performing reconciliation
In the first chapter, you configure your system to enable claims to be cleared. In the second
chapter, you ensure that all wage types that play a role in tax reporting are properly configured for
the reconciliation process.

Configuration
Tax companies
Within SAP Payroll, tax companies are assigned to employees indirectly, via personnel area and
subarea. To configure tax companies, in Customizing for Payroll USA (PY-US), choose:
Tax Tax Companies Define tax companies
Never change the mapping of personnel area/subarea combinations to tax

companies. While you can map new combinations of personnel areas and subareas to
existing tax companies, changing an existing assignment of personnel areas/subareas
to tax companies will lead to incorrect tax reporting.
When initiating production runs of original (that is, non-correction) tax forms in Tax Reporter, only
one tax company name may be specified. However, as stated earlier, a single tax company may
perform reporting for any number of tax companies aside from itself. The transmitting tax
company is a tax company under which you transmit tax reports for one or more tax
companies.
Therefore, by specifying a transmitting tax company when you run Tax Reporter, you can
simultaneously process data for multiple tax companies, even though only one tax company – the
transmitter – has been specified. This functionality can greatly reduce the number of runs that
need to be initiated and the amount of magnetic media to be produced. As mentioned under The
Tax Reporting Process, tax companies are assigned to a transmitting tax company via feature
UTXTM.
To configure feature UTXTM, in Customizing for Payroll USA (PY-US), choose:
Tax Reporter Define transmitting tax company
If you assign multiple tax companies in your organization to a single Employer Identification
Number (EIN), then you must designate a reporting tax company. The reporting data for all tax
companies assigned to the corresponding EIN is combined and reported under the tax company
specified in feature UTXRP. To this end, you must modify feature UTXRP to identify your chosen
tax company as the reporting tax company. To configure feature UTXRP, in Customizing for
Payroll USA (PY-US), choose:
Tax Reporter Define reporting tax company
Transmitting tax companies and reporting tax companies are fundamentally different.
With transmitting tax companies, you are able to identify the data from each of the tax
companies for which reporting occurred within the output (such as TemSe or paper)
of Tax Reporter. This is possible because that data remains linked to the Employer
Identification Number of the original tax company. However, if you use a reporting
company, you cannot determine which information belongs to which tax company,
because all information will be assigned to the Employer Identification Number of the
reporting tax company.

Configuration
You can set the transmitting and reporting tax company based on tax form class in features
UTXTM and UTXRP, as follows:
Enable field TFRCL (Tax form class) in feature UTXTM:

1. Execute transaction PE03.
2. Specify feature UTXTM and select the option Structure, then choose Change.
3. Under Valid fields for decisions' select field TFRCL.
4. Save your change, then activate the feature.
5. Repeat these activities for feature UTXRP.
Modify and activate the features according to the business scenario:
For example, in your company:
For W-2 (Tax form class A100), all tax companies are reported under US01; for SUI (Tax form
class Q200), all tax companies are reported under US02; for all other tax form classes all tax
companies are reported individually.
You need to modify feature UTXTM and UTXRP as displayed below and activate them.
Feature UTXTM

D TFRCL
A100 D TXCMP
A100 **** &UTXTM=US01,
Q200 D TXCMP
Q200 **** &UTXTM=US02,
**** D TXCMP
**** **** &UTXTM=****,
Feature UTXRP

D TFRCL
A100 D TXCMP
A100 **** &UTXRP=US01,
Q200 D TXCMP
Q200 **** &UTXRP=US02,
**** D TXCMP
**** **** &UTXRP=****,

Configuration
Worksites
If you intend to perform Multiple Worksite Reporting from within Tax Reporter, you must first
ensure that your worksites are properly configured. To this end, in Customizing for Payroll USA
(PY-US), choose:
Tax Tax Data Maintenance Unemployment Insurance Define unemployment

worksites
Worksite information should also be maintained for each employee in the Unemployment State
infotype (0209). To ensure that all employees are properly assigned to the appropriate worksite,
you can configure payroll calculation rule UUIM to issue an error message during payroll
processing in the event that worksite information is missing. To configure payroll calculation rule
UUIM, in Customizing for Payroll USA (PY-US), choose:
Tax Maintain Tax-Related Schemas and Rules Maintain payroll calculation rule for
unemployment Unemployment information options
If worksites have not been configured in the manner described above, Tax Reporter will use
either a dummy worksite (99) or the worksite recorded in table T5UTV. For additional information
on this subject, consult the section on Multiple Worksite Reporting.

Configuration
Configuring Magnetic Media

The magnetic media files that you create with Tax Reporter are written in TemSe file format and
have a defined life span.
The files are created with attributes including an expiration date, after which they may be deleted
by TemSe reorganization utilities. You can determine the default lifespan of Tax Reporter-related
TemSe files in the feature TEMSE (transaction PE03).
A configuration example for feature TEMSE is provided below. In this example:
The magnetic media generated in the production run is kept for 300 days.
The magnetic media generated in the test run is kept for 200 days.
OBJKN
CTRPUT &TEMSE=200,
CTRPUP &TEMSE=300,
Furthermore, we strongly recommend that you make a copy of any magnetic media that you
submit to any tax authority.
Formatting the file for download
You may need to specify some parameters in order for your file to be formatted correctly when it
is downloaded to your local drive prior to creating a diskette, tape, or online filing. This is
especially important for formats based on the MMREF-1 standard, since the files are intrinsically
the same whether filing by tape, diskette or online.
The main difference is whether carriage return/line feed characters (also known as a record
terminator or paragraph marker) separate each record and the character set (ASCII or EBCDIC).
SAP usually pre-delivers the format set according to preferences stated by the authority (for
example, our MMREF-1 for the SSA (HR_F_MMREF_1) is set to format without carriage
return/line feed characters, and to be written in ASCII mode). If different parameters are needed,
consult SAP Note 133613 and SAP Note 492380.
Submitter record parameters
Magnetic media files often have what is referred to as a submitter record, which contains data
about the person and organization responsible for the file. The submitter record may also require
some information about the file itself, such as whether it is a resubmission. At this time you need
to update this information on the magnetic media format configuration from within Tax Reporter.
To do so, in Customizing for Payroll USA (PY-US), choose Tax Reporter Tax Form Definition
Define original tax forms.
1. Select the format to be modified – for example, HR_F_MMREF_1.
2. Select the Magnetic tape structure view.
3. Review the fields of the submitter record and fill in the required parameters, by using the
Or directly field. This action is not necessary for any tape location/field where a value is
specified in the Take from field.

Configuration
Upon executing this Customizing activity, the system presents a list of the standard paper and
magnetic media formats that are delivered by SAP. You can then copy these standard formats to
your customer name range and reconfigure them, or even reconfigure them directly, without first
copying them.
Although it is possible to reconfigure the standard formats delivered by SAP to address any
unique requirements, we recommend that you copy the standard formats delivered with Tax
Reporter to the customer name range, and then modify them to meet your requirements. Any
changes that you elect to make to standard formats may be overwritten, and therefore lost, when
you apply subsequent HR Support Packages.
In many cases, SAP delivers two or more standard formats, supplying multiple magnetic media
for a single form to be submitted to a single authority. Nonetheless, additional configuration may
be required to ensure that the standard formats delivered by SAP meet both the specific
requirements of your payroll department and the general reporting requirements of tax
authorities.
In the following sections, we describe situations where such additional configuration may be
required. These sections address the substitution of magnetic media formats for W-2 reporting,
the substitution of these formats for SUI reporting, and the formatting of Magnetic Media data for
download.

Configuration
Additional Information for Tax Reporting

Additional information for tax reporting is recorded in view V_T5UX9. At present, four types of
information, described below, are found there. To maintain this view, in Customizing for Payroll
USA (PY-US), choose:
Tax Reporter Tax Form Definition Maintain additional information for tax reporting
o Magnetic Media Information
This first type of information can be used to store customer-specific information, such as
the name of a contact person, or that person’s e-mail address. Previously, this
information was maintained in the Or directly field within magnetic media configuration at
the transmitting tax company level (in record RA), or was not maintained at all within
magnetic media configuration at the tax company level (in record RE). The following
example demonstrates one possible use of this type of information.

Configuration
In the example above, the e-mail address of the contact person is stored in the first field;
fourteen additional fields are delivered in this view. Moreover, among the key fields
delivered in this view, it is not required to make an entry in each field. To illustrate, if a
single set of Magnetic Media contact information is applicable for all W-2 files in your
enterprise, then you only need to create one record for tax form class A100, then leave
tax authority as initial value. If, at a later date, certain tax authorities require different
contact information, this requirement can be fulfilled by adding entries with tax form class
A100, along with the corresponding tax authorities.
Upon adding a new entry (as shown in the previous screenshot), one simply modifies
Customizing for magnetic media in the following manner.

Configuration
o Philadelphia Resident/Non-Resident Rate
This second type of information is used to store Philadelphia resident/non-resident rates.

SAP delivered these rates for tax years 2003 through 2005; these rates will not be
delivered for tax year 2006 or subsequent tax years. Tax Reporter will read these rates –
even from client 000 – so that it is not necessary to cascade SAP-delivered entries to
productive or testing clients.
For tax year 2006 and subsequent tax years, it is incumbent upon customers first to enter
these rates themselves, then to specify tax authority PBKX and tax type 01, and finally to
enter the start and end dates that correspond to the validity period of the rate(s).
o FUTA Maximum Credit Rate
Similar to Philadelphia resident/non-resident rates, this third type of information stores the
FUTA maximum credit rate. Tax Reporter will read this rate from client 000 if Tax
Reporter cannot locate this rate in a productive or testing client.
This rate was delivered in tax year 2005 and remains unchanged in tax year 2009.
However, in future tax years, it will be incumbent upon customers first to enter this rate
themselves, then to specify tax authority FED and tax type 10, and finally to enter the
start and end dates that correspond to the validity period of the rate(s).

Configuration
o Additional Rate
This fourth type of information enables customers to comply with reporting requirements
for rates that play no part in tax calculation during payroll – for example, rates to exclude
from the calculation of tentative credit on Form 940 – and for which no corresponding tax
type exists in the system. Previously, Tax Reporter utilized constants in the Payroll
Constants table (T511K) to report this information. From tax year 2005 forward, however,
these rates might be tax company-specific, and for this reason, payroll constants can no
longer be used.
In tax year 2005 and subsequent tax years, you can maintain up to three additional rates
at the tax company/tax authority/tax type level. Rates can be entered either as positive or
negative (deduction) values. Tax Reporter, in response, will combine these rates and
populate the corresponding forms. The following example shows how to configure
additional rates.

Configuration
Generic solution for reporting multiple tax authorities on the

same magnetic media
You can create magnetic media formats for localities and assign the various codes to these
localities. As a result, you can:
Update which authorities are to be reported to each tax agency
Change the name of localities
Create a new format with configuration changes only.

This solution includes two tables:
Assign tax form to category (T5UX4)
Assign attributes to tax authority (T5UX5)
Assign tax form to category (T5UX4)

In this table, you assign each form with multiple tax authorities to be reported to a category.
Each existing or new form should have a unique category. This table is delivered with five
entries:
Category Tax Form

001 HR_F_MMREF_1_OH
002 HR_F_MMREF_1_OHV
003 HR_F_MMREF_1_OHD
004 HR_F_MMREF_1_IN
005 HR_F_MMREF_1_OHR
Tax subject H (Attributes for localities): The corresponding tax attributes assigned to this
tax subject in the Tax Attributes table T51TC are:
1 (Locality code)
2 (Tax entity code) and
3 (School District code)
You can use more than one tax attribute per tax form and add more tax attributes (other than
the three tax attributes mentioned above).
Assign attributes to tax authority (T5UX5)
In this table, you assign the tax form and its attributes to a tax authority.
You can update table T5UX5 to match any future changes a tax agency may make,
such as description changes, or changes to the list of tax authorities to be reported.

Configuration
Creating a new MMREF-1 form for a locality

1. Copy the generic layout of the MMREF-1 form or check the locality form that is similar to
the delivered form and copy it.
2. Check the magnetic structure and modify it according to layout specification

3. Add the required table entries to tables T5UX4 and T5UX5 as instructed below.
a. In Customizing for Payroll USA (PY-US), choose Tax Reporter Tax Form
Definition Custom Forms Create tax forms for Multiple Tax Authorities.
b. Select the activity Assign tax form to category.
c. Select New Entries, add a new category, and assign the tax form you just
created to this category.
4. Select the activity Assign attributes to tax authority.
a. Select New Entries.
b. Enter the category you just added, and the tax authorities you wish to report
under this category, tax attribute, and description.
You can only enter tax authorities that exist in table T5UTZ.
5. SAP supplies three tax attributes to meet the requirements for the forms. You can re-use
these attributes. In addition, you can add new tax attributes, if required, to table T51TC.
To add new attributes, proceed as follows:

a. Execute transaction SM30.
b. Enter table view V_T51TC.
c. Select Position and enter Tax subject H.

Configuration
6. You must now invoke the special processing in Tax Reporter as follows:
a. In Customizing for Payroll USA (PY-US), choose:
b. Using the Position button, enter the required tax form (for example,
Z_HR_F_MMREF_1_OHZ), then select Issuing of tax forms.
c. In the subsequent screen, select (highlight) the alternate from and select (double-
click) Magnetic tape structure.
d. Highlight the specific field, then select Details.
e. If the standard attributes can be applied to fulfill your requirements, enter the
routine names in the “Or Directly field” of the MMREF-1 format as follows.
Attribute Form name

1 $GET_LOCALITY_CODE$
2 $GET_TAXENTITY_CODE$
3 $GET_SCHOOL_CODE$
For example, if you need to configure a form to report school district codes along with school
district taxable and tax amount, enter $GET_SCHOOL_CODE$ in the Or directly field.
If you add new tax attributes to table T51TC, you need to create form routines in the include
RPCTRPUZ and copy the existing form routines (that is, GET_SCHOOLCODE$
GET_LOCALITYCODE, and so on), to your new form routines, and modify it to read the related tax
attribute and provide special processing.
During configuration, it is worthwhile to remember the following recommendations.
Assign the FORM ROUTINE in the Or Directly field of the MMREF-1 format.
The new form must be associated with the main form HR_F_W2.
Always refer to the existing formats, such as HR_F_MMREF_1_OHV,

HR_F_MMREF_1_OHD, when creating new forms.

Configuration
Standard formats vs. Custom copies

As delivered, Tax Reporter processes all output related to Form W-2 within a standard format:
HR_F_W2. Before you make changes to your system that may affect the output of Form W-2,
you should first determine whether your system has been configured to process a customer-
specific equivalent of this standard format.
To this end, in Customizing for Payroll USA (PY-US), choose Tax Reporter Tax Form
Definition Custom Forms Copy tax forms and assign them to tax form classes. Then
choose Assign tax forms to tax form classes. Specify USA or country grouping 10, then tax
form class A100.
If no entry appears on the subsequent screen, then your system is processing Form W-2 data
using the standard format, HR_F_W2. However, if an entry does appear on this screen, then
your system is using a custom copy of the standard format to process Form W-2 data. The tax
form (for example, ZHR_F_W2) indicated in the entry is the custom copy currently used by your
system for W-2 processing.
If your system features a custom copy, as described above, any output modifications that you
wish to perform should be made to this custom copy, not the standard format. If your system
does not feature a custom copy, you must decide whether you wish to change the standard
format (HR_F_W2) or create a custom copy of the format (such as ZHR_F_W2), then change it.
If you elect to create a custom copy of standard format HR_F_W2, you must create an
entry for it in the Customizing activity referenced above. This will ensure that your custom
copy, rather than the standard format, is used to process W-2 data.
Copying and revising generic formats
You can also configure the desired format yourself. To this end, SAP delivers the two standard
sample templates that can be copied and revised to create the custom W-2/SUI copy that you
require. These templates are as follows:
HR_F_MMREF_1_GEN W-2 Generic State MMREF-1 format
HR_F_MMREF_1_SUI SUI Generic State MMREF-1 format
Specifying additional standard output media
It is also possible to specify additional media – for example, to determine the output’s locality.
Proceed as follows if you wish to specify additional media.
1. In Customizing for Payroll USA (PY-US), choose:
2. Select Position, enter tax form HR_F_W2, then select Continue.
3. Highlight the table entry for this form, then select Issuing of tax forms.
4. On the subsequent screen, select New entries.
a. Enter form HR_F_MMREF_1_ZZZ, where ZZZ equals the local tax authority.
b. Enter authority ZZZ.
c. Enter sequence number 99.
d. Enter event 1.
5. Repeat the previous activity for each standard output medium per tax authority to be
added. For each additional standard output medium that you add, enter sequence
number 98, then 97, and so on. The higher the sequence number that you add, the
lower the probability that your entry will be overwritten by a subsequent HRSP,
assuming that you modify the standard format HR_F_W2, rather than a custom copy.
6. Save your entries, then exit Customizing.

Configuration
Copying and revising standard formats

If the standard formats delivered by SAP do not meet your requirements, you can copy a
standard format and revise it accordingly. In many cases, the standard formats delivered by
SAP for one authority are quite similar to the format that you would like to submit to another
authority. In such cases, you can copy the standard format and tailor it to create a custom copy
that meets your requirements.
For example, suppose you wish to produce the disk format for tax authority ZZZ W-2 data,
which is not supported by SAP. By reviewing the specifications of tax authority ZZZ, we see that
they essentially follow SSA MMREF_1 specifications and require record types RA, RE, RS, and
RT. By reviewing standard disk formats delivered by SAP, we find that the Connecticut format
(HR_F_W2_MMREF_1_CT) comes quite close in meeting this requirement, except that it also
includes record type RF. This additional record type can be easily deleted, so that a copy of the
Connecticut format can easily be tailored to meet the reporting requirements of tax authority
ZZZ.
To copy HR_F_MMREF_1_CT to a new form, such as HR_F_MMREF_1_ZZZ, proceed as
follows.
2. Select Position, enter tax form HR_F_MMREF_1_CT, then select Continue.
3. Highlight the table entry for this form.
4. Select the Copy as… icon from the application toolbar.
a. On the following screen, specify tax form HR_F_MMREF_1_ZZZ.
b. Update the form name accordingly.
c. Select Transfer from the application toolbar.
5. In the subsequent dialog box, select Copy all.
Once you have created this custom copy, you can return to the previous screen, then delete the
unwanted RT record from the new format by highlighting its table entry and selecting Issuing of
tax forms. When you are satisfied with the new format, you can configure it to be generated, as
demonstrated above.
Requesting new standard formats

In some cases, you may find that SAP Payroll does not support the format(s) that you desire or
require, although we always provide at least one standard medium to file the required data, and
we often provide several. If you prefer to file data using a medium or format that is not currently
supported, then we encourage you to log a development request or low-priority customer
message to that effect.
Unless SAP has failed to fulfill the legal requirements of a given tax authority for the
submission of form data, the absence of a particular format is not considered to be a
compliance issue.

Configuration
Formatting Magnetic Media Data for Download

Scenario
Certain tax authorities require that form data be submitted in the EBCDIC character set format.
To satisfy this requirement, SAP Payroll delivers the applicable forms in a pre-configured state.
However, under certain circumstances, employers may wish to download form data in the ASCII
character set format, either because it is easier to use or because tape creation utilities may
require source data in that format.
Consequently, additional configuration may be required to ensure that TemSe file data has been
downloaded into the proper format, be it ASCII (rather than EBCDIC) or EBCDIC (rather than
ASCII). Additional configuration may also be required if the downloaded file is not readable or if it
appears to be one large, uninterrupted record (that in fact consists of multiple records). The
additional configuration to be performed in either case is described below.
You must perform the configuration described below before you may re-execute Tax
Reporter using the Print copies function from the application toolbar.
Solution
If you experience difficulties downloading Tax Reporter TemSe file data into the proper format, or
if you encounter problems separating multiple logic records, then review the corresponding
configuration. To this end, in Customizing for Payroll USA (PY-US), choose Tax Reporter Tax
Form Definition Define original tax forms. Upon executing this activity, you may resolve
configuration errors as follows.
Downloading data in the proper format
1. Highlight the affected form, then select Issuing of tax forms.
2. On the next screen, highlight the table entry labeled "Special: download parameters,"
then select Magnetic tape structure.
3. On the subsequent screen, highlight the table entry labeled "Character set (ASC or
EBC)," then select Details (F2).
a. To download file data into ASCII format, enter ASC in the Or directly field.
b. To download file data into EBCDIC format, enter EBC in the Or directly field.
4. Save your entries, then re-execute Tax Reporter to download file data.
Separating multiple logic records
1. Highlight the affected form, then select Issuing of tax forms.
2. On the next screen, highlight the table entry labeled "Special: download parameters,"
then select Magnetic tape structure.
3. On the subsequent screen, highlight the table entry labeled "insert CRLF btw records?",
then select Details (F2). (The table entry indicates that a carriage return or line feed is
to be inserted between each record.)
a. If you wish to download file data so that a carriage return or line feed is inserted
after every record, enter CRLF in the "Or directly" field.
b. If you do not wish to download file data so that a carriage return or line feed is
inserted after every record, leave the "Or directly" field blank.
4. Save your entries, then re-execute Tax Reporter to download file data.
Ensure that you make all entries in the Or directly field in upper case.

Configuration
Configuration: Form 1099-R

The following information is based on previous logic used in Tax Reporter, when it was only
possible to assign one distribution code to an employee. For the latest enhancements, see the
following documentation on the SAP ERP HCM & Payroll U.S.A. site at
http://service.sap.com/hrusa Documentation User Guides:
1099-R: Multiple Distribution Codes in Tax Reporter
Distribution Payments User Guide
Certain configuration activities must be performed before Tax Reporter can process Form 1099-
R amounts. These activities are described in detail below.
1. Create a pension tax company
To ensure that withheld taxes are reported properly, you must create a separate tax
company from which Form 1099-R amounts can be paid. Creation of a separate tax
company is required to segregate regular and pension tax amounts and, if a trust has been
established for the pension amounts, to store tax ID numbers correctly. Do not pay
amounts that are to be reported on Form W-2 and amounts that are to be reported on
Form 1099-R from the same tax company. Employees who retire during the tax year and
receive a company pension thereafter should be transferred from the tax company where
they received regular pay into the pension tax company.
If you have mistakenly paid Form W-2 recipients and Form 1099-R recipients from a single
tax company, you may pursue three options to rectify the error.
a. Use retroactive payroll processing to transfer the amounts accordingly. However,
you can only do this if you have processed payroll in the system for the entire tax
year.
b. Access the Adjustments Workbench to move Form 1099-R amounts from the
regular pay tax company into the pension tax company.
c. Enter manual adjustments in tax interface table T5UT1.
This option, however, will not correct the payroll results.
If wage types were used to process pension payments, you can modify the tax form
groups that you are using to process Form W-2 and Form 1099-R to reflect where these
amounts should be reported.
2. Create user wage types for Form 1099-R
SAP Payroll delivers the following model wage types to support Form 1099-R processing:
M9RN (Form 1099-R non-taxable wages)
M9RT (Form 1099-R taxable wages)
In order to use these wage types as models, copy them to user wage types in your
customer name range. You must create a unique wage type for each supported
distribution code for which you wish to process payments. All supported distribution
codes, with the exception of code G (Direct rollover to IRA) are generally taxable.
Therefore, you will need to copy corresponding user wage types from model wage type
M9RT.
If you wish to withhold taxes, ensure that the specification for processing class
71 is included in the taxability model tables.

Configuration
3. Map user wage types to tax form groups

Once you complete the process of copying model wage types to their equivalents in your
customer name range, you must map these wage types to the following pre-configured tax
form groups:
99R1 Early distributions
99R3 Disability benefits
99R4 Death benefits
99R7 Normal distributions
99RG Direct rollovers to IRA (non-taxable)
Use of these wage types will cause the appropriate distribution code to be reported in
Box.7 of Form 1099-R. Tax amounts and wage bases (represented by wage types /401
and /601, respectively) will be reported in the appropriate boxes (2A, 4, 11, 12, 13 and
15). State and locality codes and names as well as ID numbers will also be reported
where required.
4. Create tax overrides
If you need to withhold tax amounts at flat rates, use standard SAP Payroll and BSI
functionality to assign taxation rate overrides for employees. This process is performed by
means of the Additional Withholding Information infotype (0234).

Configuration
Tax Reporter Configuration Checker

Use
The Tax Reporter Configuration Checker enables you to ensure that you have correctly
configured your system to run Tax Reporter. The Configuration Checker reviews a number of
areas where common errors arise, including:
TemSe file authorization

Feature changes
Definition of number ranges
Client-dependent HR forms
Consistency among tax form fields
Assignment of correction forms to original forms (and vice versa)
Tax form group evaluation rules
Assignment of tax authorities to tax form fields
Function UCQRC (for cross-quarter retrocalculations)
Conflicting record locations in Magnetic Media forms
Use of lower case in Magnetic Media forms
Use of PostScript printer drivers, based on user feature and user default
Wage type sign reversals
Correction form field names
Assignment of tax forms to tax form classes
If you are using Tax Reporter for the first time, before running the Configuration
Checker, you are required to have populated the Employee Index table (T5UX1). To
do this, you must run the report RPCTRUU6.
Configuration
No configuration is needed to run the Tax Reporter Configuration Checker; rather, the utility will
help you resolve common errors that arise as a result of incorrect or incomplete configuration.
If you are running the Tax Reporter in Test Run mode, the system does not
automatically trigger the Tax Reporter Configuration Checker.
This information is contained in the Tax Reporter log. Please check the log after running
each and every form!

Configuration
Example
While reviewing the configuration of printers in your system, the Configuration Checker produces
an error message (shown below) if no default printer has been selected or if printers in your
system do not operate on the basis of a PostScript driver.
As demonstrated above, in the case of default printer assignments and PostScript drivers, the
system generates an error, along with an explanation, for each affected form name, printer, and
driver. For additional information on any error reported by the Configuration Checker, along with
detailed instructions on how to resolve it, simply select the help icon, located in the upper right
corner of any section where an error is reported.
Access
In order to access the Tax Reporter Configuration Checker, from the initial U.S. Tax Reporter
screen, choose the menu path Utilities Check configuration. Another means of activating the
Configuration Checker is simply to run U.S. Tax Reporter in production mode for any tax form.
Within the Tax Reporter Log Manager, configuration errors of the kinds previously described are
noted in the Configuration remarks section.

Annual Processing
Year-End Processing
This section describes the processes used to perform year-end reporting within Tax Reporter.
Form W-2 Processing

Generating Form W-2 and Associated Forms
Reprinting W-2 Employee Copies
Address Changes on Form W-2 Reprints
Forms W-2c and W-3c
Correction W-2 Forms
Generating Correction W-2 Forms
Generating Forms W-2c and W-3c
Forms 1099-R and 1096
FUTA Tax Return (Form 940)
Employer’s Quarterly Federal Tax Return (Form 941)

Annual Processing
Form W-2 Processing

Definition
At the end of each year, employers are required to submit employee wage and tax information to
a variety of entities, including employees, the Social Security Administration, and state and local
tax authorities. To fulfill this requirement, employers submit Form W-2 (Wage and Tax
Statement) to these entities. Within Tax Reporter, this process is generally defined as Form W-2
Processing. However, aside from Form W-2, this process also includes the production of a
number of other paper and magnetic media forms, including:
Form W-2 – Employee copy
Form W-2 – State and local copies (Employer copy)
W-2 Audit Report
Form W-3
W-2 Federal magnetic media
Form 6559
W-2 State magnetic media
W-2 State and Local Summary
Third-Party format for Form W-2
This section features a detailed description of each of these forms.

Form W-2 – Employee copy
The Employee copy of Form W-2 is sent to employees so that it can be filed with their annual
income tax returns. The standard ("4-up") format supported by Tax Reporter allows four copies
(Employee, City, State, Federal copies respectively) to be printed on a single sheet of paper. A
one-up version of the W-2 form is also available for the states that require paper submissions.
This format only allows printing for one state and one locality per page.
If an employee earned wages (and owes taxes) in multiple states, multiple localities, or both, then
multiple pages will be generated. The locality boxes on Form W-2 (Boxes.19 through 21) are also
used to report special tax types, such as state disability insurance, workforce development
tax, and so on.
For tax year 2003 and subsequent tax years, Tax Reporter reports State Disability Insurance
(SDI) amounts for California, Hawaii, Rhode Island and New York, as well as Voluntary Disability
Insurance (VDI) for California in Box.14 of Form W-2. However, all W-2 reprints for tax year 2002
and previous tax years will still report SDI/VDI amounts in Box.19. This also applies to W-2c
forms for tax year 2002 and previous tax years.
Within Tax Reporter, the format of the employee copy meets the standard requirements
established by the Internal Revenue Service.
Section 6051(a)
Internal Revenue Code section 6051(a) states that when more than one W-2 form is generated
for an employee (due to multiple states and/or overflow on Box.12/14 entries), Federal
wages/taxes are not expected to be reported on each W-2 form. In accordance with section
6051(a), corresponding source code changes have been delivered to prevent the system from
printing Federal wages/taxes on the additional W-2 forms. This reporting change is effective for
tax year 2005. All printed copies of W-2 forms for tax year 2004 (and previous tax years) are not
affected by this change.

Annual Processing
New York City Wage Reporting

As per the New York State Department of Taxation and Finance, Office of Tax Policy Analysis, for
both full-year and part-year New York City residents, the amount reported in Box.18 should equal
the amount of federal wages earned during the period the employee was a New York City
resident. This affects all W-2 forms that report New York City wages.
Deferrals from Nonqualified plans on Box.11

The standard system is currently configured to report the deferrals from non-qualified plans, such
as 457(b) plans, in Box.11. But for some customers, deferrals from nonqualified plans should not
be reported in Box.11. This can be realized by performing the following configuration.
2. Select HR_F_W2, then choose Tax form fields.

3. Access tax form field T011 and either remove tax form group W23G, or remove
summation field T01G.
4. Save your changes.
Form W-2 – Authority copy

The Authority copy of Form W-2 is printed on paper and is not intended to be filed to the Social
Security Administration; instead, it serves as a substitute for magnetic media for those tax
authorities where magnetic media is not accepted. The Authority copy can also be filed with tax
authorities whose jurisdictions have too few employees to submit magnetic media. For this
reason, this authority copy is sorted by tax authority and employee number or social security
number. Multiple forms will be generated for employees with taxes in multiple tax authorities.

Annual Processing
Using your own Version of W-2 related output forms

Tax Reporter supports three versions of the W-2 Authority copy.
The name of the W-3 form is changed, as of tax year 2008, as outlined below:
Tax Years Tax Years Tax Year Tax Years

2000 and before 2001 to 2006 2007 2008 and after
HR_F_W2 HR_F_W2_01 HR_F_W2_07 HR_F_W2_07
HR_F_W3 HR_F_W3_01 HR_F_W3_07 HR_F_W3_08
HR_F_W2_MULT HR_F_W2_MULT_01 HR_F_W2_MULT_07 HR_F_W2_MULT_07
W-2 Self-Sealer (Form 1287)
Use layout HR_F_W2_MULT_SS to match the format of Form 1287 and print data on it, rather
than on the employee 4-up copy, layout HR_F_W2_MULT_07. Layout HR_F_W2_MULT_SS
offers a number of advantages over layout HR_F_W2_MULT_07, including faster processing in
Tax Reporter, reduced printing times and (for the Employee copy) spool sizes, and elimination of
envelopes.
Please note that some printers may introduce a shifting of template elements, resulting in overlap
of data in boxes for the PDF version of the standard W-2 Self-Sealer form. This shifting is
introduced by the printer, and could vary according to its make or model. Hence, we recommend
that you create a custom copy of the PDF form HR_F_W2_MULT_SS and manually adjust the
fields that are not aligned in such cases.
We strongly recommend that you test the new layout by printing a few Form 1287 sheets before
you purchase forms for all employees. Your testing will help you determine the compatibility of
your printers for these forms. As a rule of thumb, any printer that supports Pressure seal products
and PostScript (as described in SAP Note 102011) should function properly.
Form 1287 Configuration Changes
By default, Tax Reporter is configured to generate a 4-up copy (layout HR_F_W2_MULT_07).
After your initial testing, if you decide to use Form 1287, you must perform the following
configuration changes to activate layout HR_F_W2_MULT_SS for Form 1287.
2. Select HR_F_W2 and choose Issue of Tax forms.

3. Change the form name from HR_F_W2_MULT_07 to HR_F_W2_MULT_SS.
4. Save your changes.
Maintaining SAPscript parameters for the Form 1287 Layout
Tax Reporter Tax Form Definition Maintain SAPscript parameters for custom W-2 forms
2. Insert the following line in feature UTRW2.

Variable key Operations
HR_F_W2_MULT_SS &UTRW2=04/03/01/EE/EMPE,
3. Activate the modified feature.

Annual Processing
Form W-2, Checkboxes

The reporting process for marking the checkboxes on Form W-2 is configured in Customizing for
Payroll USA (PY-US); choose Tax Reporter Tax Form Groups Define tax form groups
containing non-tax wage types. In this activity, you perform configuration for tax form groups
W25A through W25G and the corresponding wage type assignment and evaluation rules. ABAP
user exits may also be used to implement specific business rules for each of the checkboxes.
See the previous section of this document Customer exit for W-2 form in RPCTRCU0 for more
information and example logic for user-exits.
W-2 Related Paper Forms

Marking the “Retirement plan” checkbox
The Retirement plan checkbox is marked, based on standard coding if amounts based on wage
types assigned to tax form groups (TFG) W25C – "Pension plan" or W25G – "Deferred
compensation" are positive. (If stored in payroll as negative, flip the sign when assigning the
wage type in the TFG definition). A user-exit is available if different marking is required.
See transaction CMOD, SAP enhancement "HRCTRCU0", "EXIT_RPCTRCU0_002".
Previous user-exit logic for marking the statutory checkbox, coded in RPCTRCZ0 is no longer
used. The new method (above) will prevent loss of your logic in future upgrades and Support
Package applications.
Marking the “Statutory” checkbox
The "Statutory" checkbox will be marked based on standard coding if amounts based on wage
types assigned to tax form groups (TFG) W25A – "Statutory employee" are positive. (If stored in
payroll as negative, flip the sign when assigning wage type in the TFG definition). A user-exit is
available if different marking is required. See transaction CMOD, SAP enhancement
"HRCTRCU0", "EXIT_RPCTRCU0_002".
Previous user-exit logic for marking the statutory checkbox, coded in RPCTRCZ0 is no longer
used. The new method above will prevent loss of your logic in future upgrades and Support
Package applications.
Marking the “Third party” checkbox
The "Third party" checkbox will be marked based on standard coding if amounts based on wage
types assigned to tax form groups (TFG) W25H – "Third-party sick pay" are positive. (If stored in
payroll as negative, flip the sign when assigning wage type in the TFG definition). A user-exit is
available if different marking is required. See transaction CMOD, SAP enhancement
"HRCTRCU0", "EXIT_RPCTRCU0_002".
At Release 4.70 and above, for additional information, consult the corresponding user
guide, at http://service.sap.com/hrusa Documentation Business Add-
Ins Guide for U.S. Tax Reporting.

Annual Processing
Form W-2, Employer Copy

No “Employer” copy is delivered in the standard system. We recommend that you print your own
copies for your employer records. For reprints, use the Print copies function.
W-2 Audit Report
The W-2 Audit Report is a simple summary of amounts reported on Form W-2. The report can
be used for reconciliation purposes. This form summarizes each of the taxes and wages reported
on Form W-2 in simple list form.
The W-2 Audit Report is a reconciliation feature of Tax Reporter. It is not produced to fulfill
reporting requirements.
Form W-3
Form W-3 (Transmittal of Income and Tax Statements) contains summary information for all
amounts reported by your enterprise on Form W-2 forms on paper. Tax Reporter produces a
separate Form W-3 for each tax company processed, regardless of transmitting tax company
assignments. For example, if you execute reporting for tax company US01, which transmits data
both for itself and for tax companies US02 and US03, Tax Reporter will produce three W-3 forms
– one for each tax company.
This form is provided for reference purposes only.

W-2 Federal magnetic media
W-2 Federal magnetic media includes the federal wages and taxes reported on employee
copies of Form W-2 in the form of a file, which is submitted to the Social Security Administration.
The SSA uses this file to crosscheck employer information with information reported by
employees on their annual income tax returns. Tax Reporter and the Social Security
Administration support multiple formats. For additional information, consult Configuring Magnetic
Media.
Form 6559
Form 6559 (Transmitter Report and Summary of Magnetic Media) contains summary information
for all W-2 forms that your enterprise files on magnetic media. Unlike Form W-3, Tax Reporter
produces a combined Form 6559 for all tax companies processed, regardless of transmitting tax
company assignments. In the above example, when you execute reporting for tax company US01
(which transmits data both for itself and for tax companies US02 and US03), Tax Reporter will
produce only one Form 6559 – for tax company US01.
W-2 State magnetic media
W-2 State magnetic media includes state wages and taxes reported on employee copies of
Form W-2 and submitted to various states. Tax Reporter produces magnetic media in a variety of
formats to fulfill state reporting requirements. If you need to use magnetic media in a format other
than the one delivered with Tax Reporter, refer to Substituting Magnetic Media Formats: Form W-
2.
State and Local W-2 Summary Report
You can generate a State and Local W-2 Summary Report for the tax authorities in each state
and locality where your enterprise operates. This report summarizes amounts included on the W-
2 magnetic tape and paper forms sent to these tax authorities. You can use this report to perform
Form W-2 reconciliation for state and local filing.

Annual Processing
Third-party format for Form W-2

As of Year End 2008, SAP supports the TemSe layout for W-2 paper fields, using form
HR_F_W2_TP_TEMPS. This layout contains all of the fields in the ASCII format that are available
on the W-2 paper form. The previous form, HR_F_W2_SSCR_STS, also remains available in the
system.
The standard configuration does not include HR_F_W2_TP_TEMPS or HR_F_W2_SSCR_STS

layouts as the alternate forms to the HR_F_W2 main form. To obtain them, proceed as follows:
2. Select Position, enter HR_F_W2 in the Tax form field, and choose Continue.
3. Highlight HR_F_W2, then select Issuing of tax forms from the navigation section.
4. Select Edit mode, then select New Entries.
5. Enter Sequential number of output as per the available number within Customizing.
6. Specify the tax authority FED.
7. Enter HR_F_W2_SSCR_STS and/or HR_F_W2_TP_TEMPS, based on your

requirement, and choose Display.
8. Select TemSe file as the type of output, and select Aggregation level as header
information for form.
The spool size to store TemSe files is limited to 2 GB. To ensure that the generated TemSe file
does not exceed this limit, maintain constant W2SPL in the Payroll Constants view (V_T511K)
with the number of records for which TemSe file HR_F_W2_TP_TEMPS should be split. For
example, if constant W2SPL is maintained with the value 50000, HR_F_W2_TP_TEMPS will be
split after 50,000 records.
Mappings to W-2 Paper Form boxes

Download the document Temse_File_fields.pdf, available in the Attachments section of SAP
Note 1160752, which details the mapping between W-2 form boxes and TemSe file
HR_F_W2_TP_TEMPS.
Downloading the file

The generated file of layout HR_F_W2_TP_TEMPS, with or without splits, can be viewed or
downloaded via the Tax Reporter Log Manager.

Annual Processing
Generating Form W-2 and Associated Forms

Procedure
W-2 processing, like any other tax form class, can be executed either in production mode or in
simulation (test) mode. Both run types create Form W-2. However, the difference between
these two modes is that production runs create entries in Tax Reporter Generation bookkeeping
tables T5UXX and T5UXY, while simulation runs do not. Moreover, before issuing these forms,
consider whether you would like to execute them online or in the background. Online
processing should be reserved for very small tax companies (of no more than 200
employees), or for testing a small range of employees.
2. Enter the desired Tax company, Generation date and Consider payroll results to: date.
3. Choose Annual from the tree structure on the left side of the screen, then choose W-2
Processing.
4. On the subsequent W-2 PROD. run screen, enter the necessary data by opening the
employee copy, magnetic media and employer copy drop-down sections.
5. Choose Background or Online. If you choose Background, enter your background job
scheduling data on the subsequent dialog box, then choose Save.
a. If you execute Tax Reporter online, the Tax Reporter output screen appears,
displaying the categories of output, organized in a tree structure.
b. If you execute Tax Reporter in the background, you may execute transaction
SP01 to determine which paper forms where produced. Using the Tax Reporter
Log Manager, you can also find out which spools where produced, as well as the
TemSe files that were generated. You can look at the spool or TemSe contents
by clicking on the spool or TemSe numbers in the Log Manager, but only while
the spools or TemSe files exist in the system, since they are eventually deleted.
6. To print employee copies of Form W-2, expand the Forms folder of the tree structure and
choose the icon next to W-2 Forms from the subsequent list. On the Tax Reporter
Forms Print/Preview screen, choose Print. Specify an output device, then choose Print.
7. To download a magnetic media file to a local directory, expand the Magnetic Media file
folder, then choose the desired file from the following list. The View/Download Magnetic
Tape Files screen, displaying the contents of the file, appears. Choose Download. On
the following dialog box, specify a local directory, then choose Save.
If you would like to view the structure of the file, choose File Structure from the
View/Download Magnetic Tape Files screen.
Review the Tax Reporter Log section of the report output to determine whether messages were
issued during the run, whether manual entries were read, whether employees were rejected, and
so on. For more information on this topic, refer to the Tax Reporter Log Manager section of this
guide.

Annual Processing
Reprinting W-2 Employee Copies

Use
If you have generated and distributed Form W-2 to employees and now need to reprint an
individual employee copy of Form W-2 (for example, because the employee has requested a
replacement copy), then you can use this function to re-issue Form W-2 to that employee.
Procedure
1. Execute transaction PU19 or choose, from the main U.S. Payroll menu, Subsequent
activities Period-independent Payroll supplement Tax Reporter. The initial Tax
Reporter screen appears.
2. Enter the desired tax company and dates in the corresponding fields.
3. Choose Annual from the tree structure located on the left side of the screen, then choose
W-2 Processing.
4. Select the W-2 Processing (PROD. run) tab strip on the main screen (at right).
5. Open the Employee copy drop-down section to enter the desired range of employees.
When performing this process, be certain that only the Generate employee
copy checkbox is active. Do not select the Generate magnetic tape or
Generate employer copy checkboxes.
6. Open the Magnetic media drop-down section, then de-select all of the checkboxes.
7. Open the Authority copy drop-down section, then de-select all of the checkboxes.
8. Select Print copies.
9. On the subsequent dialog box, select the appropriate Tax Reporter run, then select Print
online or Print in background.
The system defaults the latest run for all employees. If you wish to apply previous runs or
information for printing, then select the complete list from the corresponding menu path.

Annual Processing
Address Changes on Form W-2 Reprints

Features
When reprinting employee copies of Form W-2, even after magnetic media has already been filed
with the Social Security Administration, Tax Reporter reviews the most current mailing address of
the employee and records it on Form W-2, provided that the personnel number of the employee
was specified before reprinting began.
Use
To minimize the potentially adverse impact on performance that would be caused if the system
were to review master data for each and every employee, Tax Reporter will continue to read
address information from forms cluster PCL4 when printing employee copies of Form W-2 for the
entire employee population within the selected tax company.
However, using the Print copies function, you may now specify one or more employee numbers
to produce Form W-2 reprints that reflect changed employee addresses. For each employee
number specified here, Tax Reporter will review feature ADDRS to determine which subtype of
the Addresses infotype (0006) should be used during reprinting. (To configure feature ADDRS,
execute transaction PE03.)
The system will then review the Addresses infotype (0006) to obtain the most current record for
the employee(s) specified, ensuring that the most recent (that is, correct) address is displayed on
the reprinted form. If a new address is used during reprinting of Form W-2, Tax Reporter will
issue a corresponding message {New address used for reprint, alongside the affected
employee number(s)} under the "Errors and warnings" section of the Tax Reporter log.
If no employee number is specified in conjunction with the Print copies function, then Tax
Reporter will not review employee master data for address changes, and previously recorded
addresses will continue to appear on reprinted employee copies of Form W-2.
Although the Print copies function enables Form W-2 reprints to reflect changed
employee addresses, this enhancement will not update address data in form cluster
PCL4. The Print copies function button is located on the Productive run screen.
W-2: Colorado Local Occupational Tax

You have the option of printing the Colorado occupational taxes on the W-2 form.
The system default setting does not print this information.
If you decide to print them, you need to use the constant TRCLT in table T511K as a flag. Any
non-zero value in this constant triggers the printing of Colorado local occupation wages and tax
on W–2-related forms.
W-2: Commonwealth of Pennsylvania Local Services Tax

You have the option of printing Local Services Tax amounts on the W-2 form. The system default
setting, however, does not cause this information to be printed.
If you wish to print such amounts, then you must use payroll constant TRUGT in Payroll
Constants view V_T511K. Any non-zero value in this constant triggers the printing of
Commonwealth of Pennsylvania Local Services Tax amounts on W–2-related forms.

Annual Processing
Forms W-2c and W-3c

Definition
Form W-2c (Corrected Wage and Tax Statement) is filed to correct wage and tax data that was
previously reported on Form W-2. Whenever you file Form W-2c, you are also required to submit
Form W-3c (Transmittal of Corrected Income and Tax Statements), a transmittal form that
summarizes the information contained in all W-2c forms that you are filing.
Use
You may execute Tax Reporter to issue Forms W-2c and W-3c, if you have already filed Form W-
2 and now find it necessary to perform payroll retrocalculation for a period in the reporting tax
year.
Correction W-2 Forms

Definition
A Correction W–2 Form is an adjusted version of the employee copy of Form W–2. Correction
W-2 forms can be produced before tax forms are filed with tax authorities.
For information on W-2 post-filing, see the W-2 Post-Filing section.

Use
Prior to filing Form W–2 for all employees with the relevant tax authorities, but after distributing
them to employees, Tax Reporter allows you to generate Correction W–2 forms for employees
whose wage and tax information was adjusted after the distribution of all employee copies of
Form W-2. "Correction" is printed on the face of Correction W-2 forms to differentiate these
forms from the incorrect originals.

Annual Processing
Generating Correction W-2 Forms

Use
Under certain circumstances, you may need to perform a correction to an employee’s payroll
results that will affect his or her wage and tax totals on Form W-2. If you perform this correction
after generating and distributing Form W–2 to employees, but before filing W–2 forms with tax
authorities, then you can produce Correction W-2 forms from within Tax Reporter.
In system terms, the absence of a filing date for form HR_F_W2 in table V_5UXY_A
indicates that Form W-2 has not been filed with tax authorities.
Whenever a payroll run retroactively changes tax amounts for a period that has already been
processed by Tax Reporter, the Payroll component flags the payroll run and the affected
employee(s) in a special Cross-Period Recalculation table (T5UQR). Payroll function UCQRC
performs this check and flags the payroll run(s) and affected employee(s) accordingly. The
following procedure demonstrates how you can take advantage of this function.
Prerequisites
You have adjusted the payroll results of the employee(s) for whom you are generating Correction
W-2 Forms.
Procedure
Payroll supplement Tax Reporter. Alternatively, execute transaction PU19.
2. Enter the desired tax company.
3. Under Date of form generation, enter the same date of the original execution. Under
Consider payroll results to:, enter a date that is at least one day later than the date of the
original Form W-2 execution. For example: You executed the original Form W-2 run with a
Reporting period end date of 12/31/2009 and a Consider payroll results to: (or "As of") date
of 12/31/2009. Therefore, for the correction W-2 run, you must specify a Reporting period
end date of 12/31/2009; for the Consider payroll results to: date, you may specify
01/01/2010 or any date thereafter. If, for example, you specify a date of 01/15/2010, Tax
Reporter can pre-select all employees who had retrocalculations for tax year 2009 during
payroll periods whose check dates fell between 01/01/2010 and 01/15/2010.
4. Open the Annual node in the tree structure located on the left side of the screen, then
choose W-2 Processing.
5. Select the W-2 Processing (PROD. run) tab strip, located at right.

Annual Processing
6. Select the Employee copy drop-down section, then select the radio button marked Correct
Employees with retroactive changes. This will correct only those employees who had
retroactive changes for the prior year during payroll periods whose check dates fell between
the "As of" date of the last W-2 run and the new "As of" date. If, in addition, you want to
force a correction form for certain employees, you can specify those employees under
Personnel numbers, then select the radio button marked Force Correction-including the
personnel numbers above.
Remember to select Generate magnetic media (unless you are doing this later via
the Print copies function) to make sure that employee data is also corrected on
magnetic media, and not just on the paper forms.
You may select the function button to view the employees that Tax Reporter
pre-selected (that is, those with retrocalculations).
7. Select Background or Online.
Result
Correction W–2 forms are generated for the specified employee(s) and the magnetic media files
are updated to reflect the adjustments.
Even if you generate Correction W-2 forms for only a few employees, the system
may require considerable time to process the form data, since all magnetic media
files affected by the adjustments must be updated.
W-2 Post-Filing
You can generate W-2s after the original W-2 forms have been filed with the relevant authorities.
However, you can only include employees for whom no W-2s have been generated in the run.
For more information, refer to the user guide entitled “W-2 Post-Filing Run” on SAP Service
Marketplace at http://service.sap.com/hrusa Documentation User Guides W-2
Post-Filing Run.

Annual Processing
Generating Forms W-2c and W-3c

Prerequisites
You have generated Form W-2 in production mode for a tax company, then set the filing date by
choosing the icon within the Preparation/Generation dates tabstrip. These actions will
allow Tax Reporter to initiate Form W-2c processing by indicating that the forms for this tax
company have been filed.
We encourage you to set your filing dates in Tax Reporter as soon as you have
filed with the appropriate tax authorities. This will ensure the integrity of your Form W-
2 data by preventing inadvertent processing for the corresponding tax company after its
data has been filed.
Procedure
1. From the main U.S. Payroll menu, choose Subsequent activities Period-
independent Payroll supplement Tax Reporter.
2. Enter the desired tax company and generation date in the appropriate fields.
3. Choose Annual Correction from the tree structure located on the left side of the
screen, then choose W-2c – Statement of Corrected Inc. & Tax.
4. On the W-2c PROD. run screen, enter the desired range of employees, and then
choose Background or Online.
We strongly recommend that you perform production runs in the background. If

you do choose Background, enter your background job scheduling information
on the subsequent dialog box, then choose Save.
The Generation run output screen appears, displaying the categories of output,
organized in a tree structure.
5. To print employee copies of Form W-2c, expand the Forms folder of the tree
structure, then choose the W-2c Forms icon from the subsequent list. On the
following screen, choose Print. Specify an output device, and then choose the print
icon.
6. To download a magnetic media file to a local directory, expand the Magnetic Media
file folder, then choose the appropriate file from the subsequent list. The system
displays the View/Download Magnetic Tape Files screen, which displays the
contents of the chosen file. Choose Download. On the following dialog box, specify a
local directory, and choose Save.
If you would like to view the structure of the file, choose File Structure from the
View/Download Magnetic Tape Files screen.

Annual Processing
Form W-2c Processing

W-2c Reprint
The Print copies option (see below) in the selection screen always prints the latest W-2c for the
selected employee(s). However, by choosing the menu path Tools Print copies, you may
reprint the W-2c(s) with a specific As of date. This is useful, for example, if you need to
determine which W-2c is to be reprinted, if an employee has multiple W-2cs for a specific year.
The same procedure applies for Form W-3c reprints.
To identify a specific As of date, proceed as follows:
1. In view V_5UXY_A, locate the form number for W-2c with a reporting period end date
and form (HR_F_W2C).
2. Via the menu path Utilities Display form fields, execute report RPCTRDU0 for the
given form number and employee number to obtain the control numbers specific to the
employee.
3. In view V_5UXY_A, locate the As of date for the control numbers that have PCL4 results
and determine, by As of date, which Form W-2c must be printed.
4. You can re-print the specific Form W-2c by selecting the employee and As of date. To
this end, choose the menu path Tools Print copies.
Print copies
You can reprint W-2cs for selected employees and deselect the generation of magnetic
media.
You can enter personnel numbers through 'Manual EE selection' on the W-2c prod. run
tab.
If you do not want automatically selected employees to be printed, deselect Automatic

EE selection.
You can select a new checkbox Generate magnetic tape on the W-2c screen. By
default, this checkbox is not selected.
Sorting criteria for output

You can access the sorting criteria option from the W-2c main screen.
If you have a modified version of standard delivered SAPscript and want to make use of the
sorting criteria functionality, you need to set the fourth parameter in feature UTRW2 to MT.
If you are using the standard SAPscript, (for example, HR_F_W2C_01), there is no need to
create and specify the entry in feature UTRW2.
For information on customizing SAPscript for Form W-2c, review the documentation for feature
UTRW2. If you do not specify a sorting criterion, the default value is 'A/F' (tax company/personnel
number). For additional information, consult SAP Note 515199.

Annual Processing
Printing Employee Number on W-2c

You can print the employee number on Form W-2c.
The legal format for form W-2c (specified by the IRS) does not require the employee number to
be printed. However, many customers feel that it would be helpful to print the employee number
(PERNR) on the W-2c, which would allow you to identify an individual employee’s W-2c.
For more information, see SAP Note 521730.
W-2c: Automatic Employee Selection Based on Employee

Master Data Changes
If an employee’s personal data changes, and if the resultant changes in the Personal Data
infotype (0002) do not trigger retrocalculation, Tax Reporter automatically flags and selects this
employee if Form W-2c is required.
The system keeps a record of Personal Data infotype (0002) changes and selects the affected
employees for Form W-2c runs.
The form IT0002_CHANGED is included in the program SAPMPU19. This form is called in a
dynamic event when changes are made to the Personal Data infotype (0002), and it writes the
required entry in the Cross quarter retro-calculations table (T5UQR).
You must specify the dynamic events for field changes in the Personal Data infotype (0002) that
trigger a Form W-2c run, such as PERID for Social Security Number, NACHN for last name,
VORNA for first name, and MIDNM for middle name.
Example:
To activate the dynamic event1 for a change of Social Security Number, add the following entries
in the Dynamic Actions table (T588Z).
Infotype Field Name FC No. S Variable function part
0002 PERID 02 1 P PSPAR-TCLAS='A'
0002 PERID 02 2 P T001P-MOLGA='10'
0002 PERID 02 3 F IT0002_CHANGED(SAPMPU19)
The example above uses function character (FC) 02, which represents the process type Change.
1
Dynamic events are only triggered online; if you use a batch input method to introduce
changes to the Personal Data infotype (0002), those employees will not be recorded in table
T5UQR. You therefore must manually add such employees for Form W-2c runs.

Annual Processing
Depending on your requirements, you can use other values from the following list:
FC Processing type
00 Independent of the current function
02 Change
04 Create
06 Change and create
08 Delete
10 Change and delete
12 Create and delete
For additional information on these function characters, review the corresponding field help
documentation in Table T588Z, which is a client-dependent 'C' table. If the sequence numbers 1,
2, and 3 have already been used, specify other available numbers.
For more information, review SAP Note 522936.
W-2/W-2c and Related Forms – USERRA

The standard system supports the reporting of make-up contributions under the Uniformed
Services Employment and Re-employment Rights Act of 1994 (USERRA) for 401(k), 403(b), and
457(b) plans. This affects the employee W-2 and W-2c; authority W-2; audit report and W-3c
forms.
Background
If an employee returned to your employment after military service and certain makeup amounts
were contributed to a pension plan for a prior year (or prior years) under USERRA, then you must
separately report in Box.12 the previous four years of contributions for these pension plans:
401(k)
403(b)
457(b)
As an alternative, you may choose to provide a separate statement to your employee showing
USERRA makeup contributions. The statement must identify the type of plan, the year(s) to which
the contributions relate, and the amount contributed for each year. For details, refer to pages 6
and 9 within Instructions for Forms W-2 and W-3, published by the Internal Revenue Service.
Tax Reporter has set up tax form groups and tax form fields for prior year(s) and Year End 2009.
The tax form groups are named W010-W045. You must assign your user wage types to these tax
form groups, where appropriate. To this end, in Customizing for Payroll USA (PY-US), choose:
Tax Reporter Tax Form Groups Define tax form groups containing non-tax wage
types
Deactivating PCL4 Check for W-2c Runs

If you encounter lengthy runtimes when you attempt to perform an employee selection in Tax
Reporter for W-2c or correction W-2 Production runs, you may deactivate the default PCL4
check, if desired, by assigning the value 1 to payroll constant TRESF in view V_T511K. For
additional information, consult SAP Note 1019363.

Annual Processing
Forms 1099-R and 1096

Use
Use Form 1099-R to report recipient income from non-salary sources, such as pensions,
annuities, retirement or profit-sharing plans, individual retirement accounts, insurance contracts,
and so on. Use Form 1096 to transmit groups of 1099-R forms to the Internal Revenue Service
and to summarize both the total amount of federal income tax withholding reported on these
forms and the total amount of all monies reported in Box.1 of these forms.
Along with Form 1099-R employer and employee copies and Form 1096, Tax Reporter produces
Form 945 and magnetic media, as explained below.
Form 1099-R Employee Copy

This laser-printed, 4-up, recipient-level form can be mailed directly to employees. In order
to produce this form, you must have a supply of perforated forms with pre-printed
recipient instructions on the reverse side.
Form 1099-R Employer Copy

This laser-printed, recipient-level form corresponds to the IRS over-the-counter format
and can be filed to most tax jurisdictions, but not to the IRS. One form is created per
recipient.
Form 945 Annual Tax Return

This report is automatically produced during Form 1099-R processing; it contains
summarized liability per month and year of 1099-R distributions. This report cannot be
filed to the IRS, as the amounts on the report must be transferred to the pre-printed form
that the IRS sends to employers.
Backup withholding and Total deposits amounts are not supported for this form.
Form 1096 Annual Summary
This report is also automatically produced during Form 1099-R processing; it contains the
number of 1099-R forms to be transmitted, the total amount of federal income tax
withholding reported on these forms, and the total amount of all monies reported in Box.1
of these forms. This report cannot be filed to the IRS, as the amounts on the report must
be transferred to the pre-printed form that is sent to employers by the IRS.
This report cannot be filed directly with the IRS; the reported amounts must be
transferred to the pre-printed copy of Form 1096 that the IRS sends to employers,
which is then filed with that authority.
Form 1099-R Magnetic Media
This file, containing all required form data, can be downloaded and filed with the IRS.
Access
Form 1099-R is accessed from the Annual form section of Tax Reporter.

Annual Processing
1099-R: Multiple Distribution Codes

For more detailed information, refer to the user guides entitled Distribution Payments
Functionality and 1099-R: Multiple Distribution Codes in Tax Reporter on SAP Service
Marketplace at http://service.sap.com/hrusa Documentation User Guides.
1099-R/1099-R Correction Processing

You can reprint 1099-Rs for selected employees. In addition, you can generate different output,
such as Employee copies, Authority copy, and Magnetic media.
Correction 1099-R forms are essentially identical to original 1099-R forms, with the exception of
the CORRECTED indicator, which is checked on correction forms, but not on original ones.
Correction 1099-R forms do not display values that have changed since the original form was
generated. Instead, these forms simply reflect the most current values for the payee.
Screen elements
The Generate employee copy checkbox determines whether the system will generate
standard SAPscript HR_F_1099R_MULT or the customer-modified version thereof. In the
latter case, you must create an entry in feature UTRW2 and set the fourth parameter to
EE.
The Generate magnetic tape checkbox determines whether the system will generate
standard magnetic tape HR_F_1099R_TAPE or the customer-modified version thereof.
In the latter case, you must create an entry in feature UTRW2 and set the fourth
parameter to MT.
The Generate authority copy checkbox determines whether the system will generate
standard form HR_F_1099R or the customer-modified version thereof. In the latter case,
you must create an entry in feature UTRW2 and set the fourth parameter to ER.
Employee selection for re-print copies

You can enter personnel numbers in the Employee Copy sub-screen, which can be
accessed by selecting the Employee copy button in the 1099-R PROD. run tab.
Sorting criteria
You can set sorting criteria for the employee copy by selecting the option Sort Order in
the Employee copy sub-screen.
You can set sorting criteria of magnetic tape by selecting the option Sort Order in the
Magnetic tape sub-screen.
The same sort options available for W-2s are available for Form 1099-R.

Annual Processing
FUTA Tax Return (Form 940)

SAP has developed the following features for processing Form 940:
Part 1, line 2
A detailed listing of contributions is provided in a separate report. If you are reporting
Exempt payments, a new page is printed with the details of the Exempt payments.
You can use the Tax Form Groups (TFG): L201; L202; L203; L204; L205; L206; L207; L208 and
L209 for each type of exempt payment and to map associated payroll wage types.
A new page is printed with text assigned for the form group, and the amount from wage types
assigned to the specified form group.
If the amount of exempt payments shown in line 2 does not equal the sum of exempt
payments specified in the detail report, a message is displayed in the log with the
employee number and difference. While comparing the amounts, differences up to $0.05
are ignored for rounding errors.
To activate these features, you must complete the following configuration activities.
1. Specify the type of Exempt payment in the text area of the form group. Up to twenty (20)
characters of text will be printed in the new page.
2. Assign wage types to the form group, which contribute to the particular type of exempt
payment.
3. If more than nine types of exempt payments exist, create additional tax form groups by
copying them from L2xx, and additional form fields by copying them from L2xx and T2xx.
Also, modify the SAPscript layout set accordingly.
Part 2, line 3
The form reflects mid-year changes in unemployment insurance (UI) experience rates.
The system checks for UI experience rate changes in the year for all state authorities.
Depending upon the change encountered from the experience rate, the form groups and
form fields are generated dynamically.
Part 2, lines 3
Part 2, lines 3b-10 are part of the standard report.
Experience rate data is only stored on employee records in Tax Reporter table (PCL4) for
states where employee had UI contributions.

Annual Processing
Employer’s Quarterly Federal Tax Return (Form 941)

On From 941, you enter the total deposits for the quarter, including overpayment applied from a
prior quarter in line 14. If you want to print the deposit amounts based on user-defined wage
types, follow the system configuration activities described in SAP Note 415325.
Scenario:
Your company posts payroll tax amounts to separate General Ledger accounts based on tax
authority. Based on this requirement:
Tax wage types (/4xx) are remapped to user-defined wage types
Third-party remittance configuration points to the user-defined wage types instead of the
technical wage types.
In addition to the SAPscript paper form showing 941 lines 1 through 17d and schedule B, a new
TemSe file appears in the magnetic media section which details line "9-other" adjustments.
You can download this file and import it into your preferred word processing or spreadsheet
application for further formatting. You may be required to submit the information with Form 941.
The file includes:
Social Security Number
Last name
First initial
Line 9 – other total
Components of line 9 – other, including employee OASDI tax not taken and employee
Medicare tax not taken
Personnel number
An offset used for internal calculations

Quarterly Processing
This section describes the processes used to perform quarterly reporting within Tax Reporter.
Multiple Worksite Reporting

Running the Multiple Worksite Report

Multiple Worksite Reporting

Use
MWR forms issued by Tax Reporter summarize the total number of employees at various
worksites, rather than providing detailed information for each employee. These forms also list,
per worksite, the total wages for the reporting period, the headcount by month, and the address
of the reporting unit.
Configuration
As mentioned under Basic Configuration, if you intend to issue the MWR from within Tax
Reporter, you must first ensure that your worksites are properly configured in Customizing for
Payroll USA (PY-US). To this end, choose Tax Tax Data Maintenance Unemployment
Insurance Define unemployment worksites.
Worksite information must also be maintained for each employee in the Unemployment State
infotype (0209). To ensure that all employees are properly assigned to the appropriate worksite,
you can configure payroll calculation rule UUIM to issue an error message during payroll
processing in the event that worksite information is missing. To configure payroll calculation rule
UUIM, in Customizing for Payroll USA (PY-US), choose Tax Maintain Tax-Related Schemas
and Rules Maintain payroll calculation rule for unemployment Unemployment information
options.
Implementation Considerations
When you execute Tax Reporter to produce the MWR, you may notice one or more messages in
the Tax Reporter Log, depending on the configuration of your worksites and the assignment of
your employees to those worksites. The messages are as follows.
Employees with worksite assigned from the Unemployment State infotype (0209)
Employees listed under this message either lacked a worksite assignment in the Unemployment
State infotype (0209) when the payroll was originally run, or else the worksite assignment for
these employees has been updated. For the employees listed in this section, Tax Reporter uses
the most recent worksite assignment in the Unemployment State infotype (0209) that was valid
(as of the quarter-end date) for the tax company and tax authority being evaluated.
Employees with no worksite assignment; worksite in T5UTV used instead
Employees listed under this message lacked a worksite assignment in the Unemployment State
infotype (0209). For these employees, Tax Reporter uses an entry from worksite table T5UTV,
based on the employee’s tax company and the tax authority. To avoid this message during future
quarterly reporting, maintain worksite information in the Unemployment State infotype (0209) for
the affected employees.
Employees with no worksite assignment; worksite 99 used instead
Employees listed under this message lacked a valid worksite assignment in the Unemployment
State infotype (0209), and Tax Reporter could not find a default worksite in table T5UTV for the
employee’s tax company and the tax authority. For these employees, Tax Reporter uses dummy
worksite 99. To avoid this message in future quarterly reports, maintain worksite information for
the affected employees in the Unemployment State infotype (0209).

Running the Multiple Worksite Report

Prerequisites
You have entered the relevant worksite data for each of your employees in the Unemployment
State infotype (0209).
Procedure
2. Execute Tax Reporter for the desired tax company. Choose Multiple Worksite Report
– Combined for central filing to the BLS or Multiple Worksite Reports – State Level if
you have chosen to file separately with each state.
Download the TemSe file created by Tax Reporter to magnetic tape, then submit the tape to the
appropriate authority or authorities.

Automatic Override of Worksite

When overriding worksite information based on the Unemployment State infotype (0209),
worksites are checked against the worksite table (that is, T5UTV) for the Tax Company and
authority being evaluated.
Example of message in log
00000008 US01 NY Assigning WKSIT from P0209
00000008 = personnel number;

US01 = tax company;
NY = tax authority;
P0209 indicates that it was overridden from the Unemployment State infotype (0209).
If no worksite assignment is found on the Unemployment State infotype (0209), the system first
tries to assign a default based on the worksite table (T5UTV). If no entry is found in the worksite
table, worksite 99 is applied.
Example of message in log when overriding based on table T5UTV
00000008 US01 NY Assigning WKSIT from T5UTV

US01 = tax company;
NY = tax authority;
T5UTV indicates that it was overridden from table T5UTV.
Example of message in log when overriding using worksite 99
00000008 US01 No WKSIT, assigning 99

US01 = tax company;
NY = tax authority;
99 indicates that the worksite could not be overridden from the Unemployment State infotype
(0209) or from table T5UTV.
During configuration, it is worthwhile to remember the following recommendations.
Messages are only issued if the override worksite differs from the one the recorded in
table TAXR of the payroll result cluster.
Messages are not issued when processing the Federal tax authority, as the worksite is
not required at that level.
Messages are only issued once per combination of employee, tax company and tax
authority.

Turning off Automatic Override

If you do not want to use this logic, you can turn it off by making the following entry in the payroll
constant table T511K.
0: Override is shut off.

1: Override is left on.
CG Constant From To Value Text

10 TRWSO 01/01/1990 12/31/9999 0/1 TR: wrkst override
If worksite information is not recorded in the interface table (T5UT1) because the information was
not in the Unemployment State infotype (0209) at the time the payroll result was written or put
into T5UT1, worksite $$ will be assigned and reported under a worksite with the description "EE
without worksite".
The employee will continue to be reported in the log, as before, indicating that said information is
missing.

Reconciling Multiple Worksite Report (MWR) and State

Unemployment Insurance (SUI) totals
If you transfer employees between worksites during the reporting period, or if you do not maintain
the correct worksite assignment on the Unemployment State infotype (0209), the following issues
may arise:
MWR and SUI totals may not match if an employee is recorded in multiple worksites
during the reporting period and if one of the worksites has a negative total, causing those
amounts to be dropped from the report.
The sum of MWR worksite totals may not equal the report total if the employee did not
have a worksite assignment and was therefore not reported in the details.
Reconciliation issues can be minimized with proper infotype maintenance, worksite assignment,
and payroll calculation customizing.
If you are producing the MWR from within Tax Reporter, you must maintain the worksite
information on the Unemployment State infotype (0209).
Worksite information is recorded in each payroll cluster. To insure that worksite information is
maintained and recorded properly in each payroll result, you can customize rule UUIM, (located in
subschema UTX0 of the main payroll calculation schema U000), to reject an employee if worksite
information is missing.
To minimize the issues caused by multiple worksite assignments during a reporting period,
please consider the worksite assignment guidelines as described by the Bureau of Labor
Statistics (BLS). These guidelines state that if an employee moves often between worksites, the
employer may assign the employee to a physical location where either the employee spends
most of his/her or time or where the employee is supervised or receives control. The employee
should be counted one time at one location.
In order to minimize the impact of not following the above procedures, the MWR produced by Tax
Reporter behaves as follows:
If the payroll results, — in the cluster PCL4 — show that the employee was recorded in more than
one worksite during the reporting period; this information will be overridden using the last worksite
valid for the reporting period per Unemployment State infotype (0209) record.
One negative consequence of applying this logic arises if the Unemployment State infotype
(0209) is maintained retroactively after MWR is filed, in which case you may not be able, without
the original spool file, to reproduce the report exactly as filed. If you do not wish to use this logic,
you may deactivate it by performing the following entry in the Payroll Constants table (T511K).
A value of 0 deactivates this logic, while a value of 1 leaves the logic active.
CG Const From To Value Text (from T512L)

10 TRWSO 01/01/1990 12/31/9999 0 or 1 TR: wrkst override

If worksite information is not recorded in payroll cluster PCL4, because the information was not in
the Unemployment State infotype (0209) at the time the payroll result was written or placed in
table T5UT1, worksite $$ will be assigned and reported under a worksite with the description EE
without worksite. The employee will still be reported in the log, as before, indicating that this
information is missing.
Submitting Multiple Print Jobs for SUI Wage Reporting and

Multiple Worksite Reports – State Level (MWR)
To submit multiple print jobs in the background, the payroll constant TRSMP must have a non-
zero value in the table T511K.
For example:
Constant Payroll constant Start date End date Value

TRSMP TR Mult. print jobs 01/01/2009 12/31/9999 1.00
Multiple print jobs will be created for all SUI and MWR runs where the reporting period end date
lies between the start date and end date of the constant TRSMP.
Regardless of which non-zero value you enter, the system creates one print job for each main
form in the tax class – that is, one print job for each state authority for SUI and/or MWR (including
correction) forms. If the value for constant TRSMP is zero, the system will not create multiple print
jobs.
Since Tax Reporter always submits separate jobs for magnetic media and paper forms, two jobs
will be submitted for each state in SUI/MWR processing during a production run (in the
background).
SAP delivers MWR reports only for certain states, and all of these states have the same MWR
reporting requirements, so if customers wish to configure MWR reports for other states, they can
copy and configure the definitions of existing states for the new states they require. For additional
information, consult SAP Note 108565.

Locality Wage Listing

Introduction
You can use a quarterly locality wage listing to report income tax and taxable wages, employee
name, address, and Social Security Number information to local authorities.
This means that you can accurately comply with different reporting requirements for different
states, for example:
In Kentucky, you can comply with the requirement to report transportation tax (tax type
50), occupation tax (tax type 51), and school tax (tax type 53).
In Pennsylvania and Ohio, you can accurately report local income taxes.
Restrictions
The standard layout for the locality report is identical for all tax types and localities. If you wish to
change the layout for a specific locality/localities (for example, in Pennsylvania), then you must
customize each and every form.
Customizing
If your reporting requirements cannot be met by the standard solution – for example, if you want
to generate a report for a specific tax type that is not included in standard system, or you want to
generate a local report for some states other than Pennsylvania, Kentucky, and Ohio – you can
customize the report as follows:
Add New Tax Type to Existing State
To generate reports for tax types that are not in the system – for example, transportation tax (tax
type 50) report for Pennsylvania city level authorities – you must create tax form fields associated
with transportation taxable amounts and tax under form HR_F_LOCWL_D_PA. In response, the
system will automatically generate a report for employees with transportation taxable amounts.
To this end, in Customizing for Payroll USA (PY-US), choose Tax Reporter Tax Form
Definition Define original tax forms.
1. Select the entry HR_F_LOCWL_D_PA, then select the Tax form fields node from the tree
structure at left.
2. Select the entries TLO1 (Income Taxable) and TLO2 (Income Tax), then choose Copy as
from the application toolbar.
3. Specify your target entries as follows:
a. Replace TLO1 with ZLXX.
b. Modify the name from Income Taxable to Transportation Taxable.
c. Modify the Tax form group field from 0001 to the value defined for tax type 50.
4. Repeat step 3. for entry TLO2.
5. Save your entries, then execute Tax Reporter.

Add New State with Existing Tax Type
As delivered in the standard system, the locality wage listing generates reports for Pennsylvania,
Ohio, and Kentucky. If you wish, for example, to generate a report at the county level (tax level C)
in the State of Indiana, in Customizing for Payroll USA (PY-US), choose Tax Reporter Tax
Form Definition Custom Forms Copy tax forms and assign them to tax form classes
Copy tax forms.
1. Copy tax form HR_F_LOCWL_C_PA to ZR_F_LOCWL_C_IN, and select Copy all when the
system inquires whether you wish to copy the entry with all dependent entries.
2. Change the Tax Authority in tax form ZR_F_LOCWL_C_IN from PA to IN.
3. In the subsequent activity (Assign tax forms to tax form classes), assign
ZR_F_LOCWL_C_IN to tax form class Q600.
Add New State with New Tax Type

If you wish to add a new state with a new tax type that is not delivered in the standard system –
for example, to add Employer Occupation Tax (tax type 54) reporting for the City and County of
Denver (tax level D) in the State of Colorado – then perform the instructions provided below.
1. In Customizing for Payroll USA (PY-US), choose Tax Reporter Tax Form Definition
Custom Forms Copy tax forms and assign them to tax form classes.
2. Select the first activity: Copy tax forms.
3. Copy tax form HR_F_LOCWL_C_PA to ZR_F_LOCWL_C_CO, and select Copy all when
the system inquires whether you wish to copy the entry with all dependent entries.
4. Change the Tax Authority in tax form ZR_F_LOCWL_C_CO from PA to CO.
5. In the subsequent activity (Assign tax forms to tax form classes), assign
ZR_F_LOCWL_C_CO to tax form class Q610.
6. In Customizing for Payroll USA (PY-US), choose Tax Reporter Tax Form Definition
Define original tax forms.
a. Select the entry ZR_F_LOCWL_F_CO, then select the Tax form fields node from
the tree structure at left.
b. Select the entries TLO1 (Income Taxable) and TLO2 (Income Tax), then choose
Copy as from the application toolbar.
c. Specify your target entries as follows

Replace TLO1 with ZLXX.
Modify the name from Income Taxable to Employer Occupation Taxable.
Modify the Tax form group field from 0001 to the value defined for tax type 54.:
d. Repeat step 6c. for entry TLO2.

Add New Tax Level

If you wish to add a new tax level that is not delivered in the standard system – for example, if
you wish to add Transit District Excise Tax (tax type 35) reporting for the Portland TriMet
Authority (tax level F) in the State of Oregon – then perform the instructions provided below.
classes
2. Copy tax form class Q600 to ZXXX.
3. Modify the name from Locality Wage Listing – County Level to Locality Wage Listing –
Portland TriMet.
4. Assign user-defined tax form class attributes by selecting tax form class Q600 and
copying the appropriate attributes to tax form class ZXXX.
Do not modify the field Variant; the system uses it to identify the locality wage listing.
Tax Reporter Tax Form Definition Custom Forms Copy tax forms and assign
them to tax form classes
a. Copy tax form HR_F_LOCWL_C_PA to ZR_F_LOCWL_F_OR, and select Copy
all when the system inquires whether you wish to copy the entry with all
dependent entries.
b. Change the Tax Authority in tax form ZR_F_LOCWL_F_OR from PA to OR.
c. Assign tax form ZR_F_LOCWL_F_OR to tax form class ZXXX.

a. Select the entry ZR_F_LOCWL_F_OR, then select the Tax form fields node from
the tree structure at left.
b. Among the tax from fields listed in tax form ZR_F_LOCWL_F_OR, identify all tax
form fields that bear tax level C and modify this tax level from C to F.
c. Select the entries TLO1 (Income Taxable) and TLO2 (Income Tax), then choose
Copy as from the application toolbar.
d. Specify your target entries as follows:
Replace TLO1 with ZLXX.
Modify the name from Income Taxable to Transit District Excise Taxable.
Modify the Tax form group field from 0001 to the value defined for tax type 35.
e. Repeat step 5d. for entry TLO2.


Issue Magnetic Media

You can report locality wage information electronically. However, SAP does not provide electronic
wage reporting formats for these localities as part of the standard system.
You can generate magnetic media output for locality wage listing as follows:
1. Copy an existing magnetic media entry (for example, HR_F_MMREF_1_PA) in the system to
your own magnetic media (for example, ZR_F_LOC_PAXX, where PAXX = your local
authority).
2. Modify the magnetic media structure according to the specifications provided by your local
authority.
3. Add your entry ZR_F_LOC_PAXX under the main form HR_F_LOCWL_D_PA. If PAXX is a
city level authority, specify tax authority PAXX.
For details on how to create and customize magnetic media, see the Configuration section and
SAP Note 306543 and SAP Note 305046.

Payroll Considerations
This section addresses important payroll issues that directly affect the process of tax reporting.
Claims Processing
Payroll Reconciliation Report
Tax Form Reconciliation
Manual Entry Adjustments
The Adjustments Workbench
Tax Reporter Payroll Constants

Claims Processing
Use
Normally, if an employee is overpaid, retroactively adjusting the overpayment will carry forward
into the current period, reducing the amount of current pay and clearing the original overpaid
amount. However, if the employee does not have enough money in the current period to cover
the entire amount of the overpayment, the system creates a claim. If left alone, the claim will be
carried forward into subsequent periods, reducing future pay until it is cleared. If the claim is
large and the employee remains active, you may wish to set up a payment plan. However, for
inactive employees, claims must be cleared, either as forgiven amounts or as repayments, and
either partially or in full.
At the end of the year, you need to determine how you want to resolve any outstanding claims. It
is advisable to clear all outstanding claims from your system before running the first payroll of the
new year, since claims repaid in the current year for the prior year should be processed as a
Claim of Right.
You can execute the Payroll Reconciliation Report to identify employees with claims. Once you
have isolated these claims, execute the Claims Processing Report to determine the
components of each claim (such as earnings, taxes, and deductions) and to decide which of the
amounts should be fully repaid, which fully forgiven, and which partially forgiven. Using the
Claims Processing Report, you can also act to clear claims and to establish employee payment
plans so that the claim is repaid over a longer period.
All prior-year adjustments, whether negative or positive, are still carried into the
current pay period and processed as normal retroactive payments. Should you wish
to process an overpayment from a prior year as a Claim of Right, you must clear the
claim with special Claim of Right Wage Types.
Access
To access the Claims Processing Report from the main U.S. Payroll menu, choose Subsequent
activities Period-independent Payroll supplement Claims processing. For detailed
documentation on claims processing, choose Help Application help from the initial screen of
the report.
Additional documentation on claims processing is provided in the user guide entitled “Claims
Processing" on SAP Service Marketplace at http://service.sap.com/hrusa
Documentation User Guides Claims Processing.

Payroll Reconciliation Report

Use
The Payroll Reconciliation Report is a tool that is used to reconcile payroll results from a
specified time interval both with Tax Reporter results and, to a lesser extent, with the amounts
posted to the SAP ERP Financials (FI) application component. The Payroll Reconciliation Report
can be executed before, during, or after Tax Reporter processing runs to crosscheck the
accuracy of the results produced by Tax Reporter vs. those produced in SAP Payroll.
The output of the Payroll Reconciliation Report is intended to reflect actual payroll results as
closely as possible. It is not the intent of the report to duplicate the logic of FI posting programs,
nor of third-party remittance functionality, nor of Tax Reporter. Therefore, amounts reported by
the Payroll Reconciliation Report will not necessarily match the results of other reporting
programs. Indeed, the fundamental purpose of the Payroll Reconciliation Report is to enable
users to discover and understand such discrepancies, so that they may ultimately resolve them.
Although the Payroll Reconciliation Report can be used to balance payroll results throughout the
year, many users will find it to be most useful when executed in conjunction with Tax Reporter
during the Year End timeframe.
Access
To access the Payroll Reconciliation Report from the main U.S. Payroll menu, choose
Subsequent activities Period-independent Payroll supplement Payroll reconciliation
report. For detailed documentation on the Payroll Reconciliation Report, choose Help
Application help from the initial screen of the report.
System documentation for the Payroll Reconciliation Report is also available on SAP Service
Marketplace. To access this documentation, visit http://service.sap.com/hrusa, then
choose Documentation User Guides Payroll Reconciliation Report.

Tax Form Reconciliation

Definition
All reconciliation of amounts reported and amounts paid is accomplished with the Payroll
Reconciliation Report. Using this application, you can balance amounts reported on tax forms
with Payroll and FI by viewing the total amounts in payroll results for selected wage type
groupings (such as taxable earnings) per tax company, tax form and tax authority. In addition, the
Payroll Reconciliation Report is specially designed to display any retrocalculations that affected
payroll results for the reporting period but that were not included on tax forms because they were
processed after the tax form run.
Example
Form W-2 is run for Reporting Period End Date 12/31/2009; Tax Reporter is instructed to
Consider Payroll Results to 01/15/2010. On January 16, you perform a retrocalculation
that changes the taxable wages of an employee in 2009. This prior-year adjustment will
be listed separately on the output of the Payroll Reconciliation Report, because the tax
form itself will not reflect the adjustment amount.
Process Description
To reconcile a tax form produced by Tax Reporter with Payroll or FI, follow these general
guidelines:
1. Instruct the Payroll Reconciliation Report to review data for the same tax company and
reporting period for which you produced the tax form to be reconciled.
Running the Payroll Reconciliation Report for a specific tax company may cause
the report to run more slowly than it would for another selection, such as
company code or personnel area. If your tax company contains 10,000
employees or more and if it maps data exactly to one personnel area/subarea or
company code, we recommend that you specify those criteria to run the
application, rather than choosing the tax company on the report selection screen.
This is recommended because company codes, personnel areas and personnel
subareas correspond to HR Logical Database fields, while tax companies do not.
HR reports can select employees more quickly when processing Logical
Database fields, rather than other fields. In addition, choosing "employee details"
for a large employee range can significantly detract from the performance of the
application.
2. Review the wage type groupings on the application to ensure that they correspond to the
boxes on the tax form to be reconciled.
When performing reconciliation for a tax form, be certain to specify tax company and
tax authority as "reportable fields" on the selection screen. Otherwise, tax wage type
amounts will be totaled for all tax companies and authorities, yielding unusable
results.

3. Where variances exist between the Payroll Reconciliation Report and the selected tax
form, review the following two factors:
a. Number of employees selected. The Payroll Reconciliation Report will select all
employees in the specified tax company and period that have current RT results.
Tax Reporter, however, features processing logic to reject certain employees
from a tax form run, such as employees who have negative wages. Before
running the Payroll Reconciliation Report, always review the Tax Reporter Log
for the form to be reconciled to determine whether employees were rejected from
the tax form run, and if so, how many. If employees were rejected, be certain to
exclude these employees manually from the Payroll Reconciliation Report run.
b. Manual entries in the Tax Interface Table (T5UT1). You may sometimes need
to perform manual entries for an employee in one or more tax form groups, to
ensure that amounts that were excluded from payroll results for some reason are
included on the tax form. Since the Payroll Reconciliation Report does not read
this table, you need to know which employees had manual entries, and which tax
form groups or wage type groupings these employees affected.
Result
Using the basic technique described above, you can quickly identify the source of variances
between payroll results or FI postings and tax form data.

Manual Entry Adjustments

Manual adjustment of entries in Tax Reporter is designed so that you can correct discrepancies in
employee records without impacting payroll results. You can also use manual entry adjustments
to generate tax forms for employees who are being paid on a non-SAP payroll system, such as
executive payroll outsourcing.
For more information, refer to the user guide entitled “New User Interface and Processing for
Manual Entries” on SAP Service Marketplace at http://service.sap.com/hrusa
Documentation User Guides New User Interface and Processing for Manual Entries.
The Adjustments Workbench

To access the Adjustments Workbench user guide, visit http://service.sap.com/hrusa,
and then choose Documentation (left frame) User guides (left frame) Adjustments
Workbench (right frame). On the subsequent screen, choose Adjustment Guide for Release
4.6C and above.
Tax Reporter Payroll Constants

For reference, the following table provides a summary of payroll constants within the standard
system that impact tax reporting. For each constant, additional sources of information are named.
Constant Purpose For additional information:

Review the user guide for
TR99R Define 1099-R min. gross distribution < $10 multiple distribution codes.
TRCLT Colorado Local OPT on Form W-2 Consult SAP Note 540100.
TRCOM Fill job number of pers. nos. for PCL4 commit Consult SAP Note 414496.
TRESF Deactivate PCL4 check Consult SAP Note 1019363.
TRPRN Puerto Rico control no., using laser printer Consult SAP Note 576263.
TRSMP Multiple print jobs for SUI and MWR reports Consult SAP Note 563242.
TRUGT Pennsylvania OPT / LST on Form W-2 Consult SAP Note 905235.
TRWSO MWR override: EE counts, SUI Reconciliation Consult SAP Note 197437.
W2SPL Third Party Layout (Form W-2): Splitting TemSe file Consult SAP Note 1160752.

Additional Resources
Additional Resources
SAP Online Documentation
Thorough online documentation is available via SAP Help Portal, at http://help.sap.com.
No user name or password is required to access this information.
U.S. Tax Reporting with PDF-Based Forms
For SAP ERP 6.0 customers who use the U.S. Payroll component of SAP ERP Human Capital
Management to perform quarterly and year-end tax reporting with PDF-Based Forms, a
corresponding user guide is available online, at http://service.sap.com/hrusa.
SUI XML Reporting in Tax Reporter
For all customers who use the U.S. Payroll component of SAP ERP HCM to conduct XML
reporting – for example, to report State Unemployment Insurance reporting on a quarterly basis –
a user guide is published on this topic online, at http://service.sap.com/hrusa.
Business Add-Ins Guide for U.S. Tax Reporting
For an overview of BAdIs that influence tax reporting, visit http://service.sap.com/hrusa
Documentation Business Add-Ins Guide for U.S. Tax Reporting.
U.S. Tax Reporter: Frequently Asked Questions
In the Documentation section located at http://service.sap.com/hrusa, you may review
Frequently Asked Questions for U.S. Tax Reporter.
Course Registration via SAP Education
To register online for HR710 – U.S. Tax Reporter, visit SAP Education.
State Governments
To view the Web site of any state government, visit www.state.xx.us, where xx corresponds to
the two-character code established for that state by the United States Postal Service. For
example, to view the official Web site of the State of California, visit http://www.state.ca.us.
Tax Authorities
To view the Web site of the Internal Revenue Service, visit http://www.irs.gov.
To view the Web site of a state or territorial tax authority, select the corresponding link below.
Alabama Idaho Montana Puerto Rico
Alaska Illinois Nebraska Rhode Island
American Samoa Indiana Nevada South Carolina
Arizona Iowa New Hampshire South Dakota
Arkansas Kansas New Jersey Tennessee
California Kentucky New Mexico Texas
Colorado Louisiana New York U.S. Virgin Islands
Connecticut Maine North Carolina Utah
Delaware Maryland North Dakota Vermont
District of Columbia Massachusetts Northern Mariana Islands Virginia
Florida Michigan Ohio Washington
Georgia Minnesota Oklahoma West Virginia
Guam Mississippi Oregon Wisconsin
Hawaii Missouri Pennsylvania Wyoming

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U.S.

Tax Reporting Guide

Year End 2009

U.S. Tax Reporting Guide, Year End 2009 2

U.S. Tax Reporting Guide, Year End 2009 3

U.S. Tax Reporting Guide, Year End 2009 4

HRSP plus CLC Option

U.S. Tax Reporting Guide, Year End 2009 5

Year End 2009: Enhancements and New Developments

W-2 Related Paper Forms

W-2c Related Paper Forms

Puerto Rico W-2/W-2c Forms

U.S. Tax Reporting Guide, Year End 2009 6

1099-R Related Paper Forms

XML Reporting in U.S. Tax Reporter

State Unemployment Insurance (SUI) Magnetic Media Reporting

U.S. Tax Reporting Guide, Year End 2009 7

Generation / Filling Date for W-2 Run

Automatic Employee Selection for W-2c Runs

PDF Forms in SAP enhancement package 4 for SAP ERP 6.0

U.S. Tax Reporting Guide, Year End 2009 8

U.S. Tax Reporting Guide, Year End 2009 9

To this end, in Customizing for Payroll USA (PY-US), choose:

Tax Reporter Tax Form Definition Define original tax forms

U.S. Tax Reporting Guide, Year End 2009 10

The topics addressed here include:

U.S. Tax Reporting Guide, Year End 2009 11

Using Tax Reporter

Form W-2c Corrected Wage and Tax Statement

Form 940 Employer’s Annual Federal Unemployment Tax Return

Form 941 Employer’s Quarterly Federal Tax Return

Form 941c Supporting Statement to Correct Information

Form 1099-R Distributions from Pensions, Annuities, Retirement or

Quarterly State Unemployment Insurance (SUI) wage reports

Quarterly Multiple Worksite Reports (MWR)

Localities Reporting (limited)

At the state level, Tax Reporter supports the following forms:

Puerto Rico: Forms W-2, W-2c, 940 and 941

New York: Fourth-quarter combined wage reporting

Arkansas: Reporting of exempt wages (on form AR-TX).

U.S. Tax Reporting Guide, Year End 2009 12

The initial Tax Reporter screen is shown below.

U.S. Tax Reporting Guide, Year End 2009 13

The Tax Reporting Process

U.S. Tax Reporting Guide, Year End 2009 14

Results table RT of payroll results cluster PCL2

Manual entries from tax interface tables T5UT1 and T5UT2

U.S. Tax Reporting Guide, Year End 2009 15

U.S. Tax Reporting Guide, Year End 2009 16

Display PCL4 Details (RPCTRDU0)

1. Execute transaction PU19 to access this program.

2. Specify the corresponding tax company and reporting period.

3. Select Utilities Display form fields.

5. Specify whether a test or productive run is to be performed.

Delete production PCL4 Details (RPCTRDUP)

1. Execute transaction PU19 to access this program.

2. Specify the corresponding tax company and reporting period.

3. Select Utilities Delete Production PCL4 Data (for production runs).

U.S. Tax Reporting Guide, Year End 2009 17

Delete test PCL4 Details (RPCTRDUT)

1. Execute transaction PU19 to access this program.

2. Specify the corresponding tax company and reporting period.