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Annualized Tax Deduction

Former Member
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We have a deferred comp benefits plan which payout annually after employee retires.

The requirement is to tax this one time different comp payment at Annualized Rate (Table 7 on IRS Circulation E).

Since the employee is on Bi-Weekly Payroll, BSI is always calculating Tax using Bi-Weekly Tax Table on IRS Circulation E.

Is there a way to override this to Tax this one time Payment at annualized rate from Table 7 on IRS Circulation E.

Thanks for your help!

Vaibhav Thokia

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Answers (1)

Answers (1)

Former Member
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I still need help with this situation. Here are more details.

We have a scenario where we have to make deferred comp payment to certain associates.

Catch is this deferred comp payment should be taxed as annualized Payroll period and not the bi-weekly payroll period.

So if  you refer to IRS Circular E for tax calculation, this payment should be taxed as per the calculation in Table 7 – Annual Payroll Period.

I called BSI for the help and only way they would  use Table 7 if we on BSI interface we send value 1 on field PP ( Payroll Period).

Field PP on BSI Interface is being populated through employee Payroll Area. Is there a way to overwrite this field on BSI interface in SAP?