Entering Federal Tax Rules for a GRE

To enter tax information for a GRE, use the Organization window.

arrow icon   To enter Federal tax rules for a GRE:

  1. Enter or query the GRE in the Organization window.

  2. In the Organization Classifications region, place the cursor on the classification Government Reporting Entity, click Others, and then select Federal Tax Rules.

  3. Click in the Additional Organization Information field to open the Federal Tax Rules window.

  4. Specify the following parameters:

    Social Security Self Adjust Method (required) Select a self adjust method for Social Security.
    The method you select determines the calculation of withholding for taxes taken as a percentage of earnings, until an employee's earnings reach an upper earnings limit. The Self Adjust method ensures greater accuracy by basing withholding calculations on year-to-date earnings, instead of earnings this period.
    Medicare Self Adjust Method (required) Select a self adjust method for Medicare.
    The method you select determines the calculation of withholding for taxes taken as a percentage of earnings, until an employee's earnings reach an upper earnings limit. The Self Adjust method ensures greater accuracy by basing withholding calculations on year-to-date earnings, instead of earnings this period.
    FUTA ER Self Adjust Method (required) Select a self adjust method for FUTA ER.
    The method you select determines the calculation of withholding for taxes taken as a percentage of earnings, until an employee's earnings reach an upper earnings limit. The Self Adjust method ensures greater accuracy by basing withholding calculations on year-to-date earnings, instead of earnings this period.
    FUTA Override Rate (optional) Select the FUTA override rate.
    Type of Employment (optional) Select the type of employment to enter for the GRE on Form 941, the Employee Quarterly Federal Tax Return.
    Government Employer (optional) Select Yes or No
    The Government Employer field determines if the employer is a state or local government entity, or a government contractor and you pay one or more of your employees under the same tax rules as a state or local government employee.
    Tax Group (optional) If this GRE belongs to a Tax Group, enter its name.
    The Tax Group associates several GREs so that employees who transfer from one GRE to another within the group receive credit in the new GRE for amounts withheld in the former GRE toward Social Security and FUTA.
    Supplemental Tax Calculation Method (optional) Select the GRE's method for calculating tax liabilities on employees' supplemental earnings. The choices are:

    • Aggregation

    • Cumulative Aggregation

    • Flat Percentage


    Consult the Vertex Calculation Guide for detailed explanations of the different calculation methods.
    FIT Exempt from Wage Accumulation (PR) (optional) This field is enabled only if you have selected Puerto Rico as the tax jurisdiction in the W2 Reporting Rules window for a GRE. See: Identifying a GRE for more information.
    Select Yes to exempt all employees in a GRE from the withholding and reporting of federal income wages and taxes. If you select Yes at the GRE level, then the value set at the GRE level overrides the value that you set in the FIT Exempt from Wage Accumulation field in the Federal Tax Rules window for an employee assignment.
    If you select No or leave this field blank, then the value set at the assignment level takes precedence. See: Entering Federal Tax Rules for an Employee