Use this screen to verify that the last pay period for the current payroll year is open, close it, and then open the first period in the next payroll year.

You can also update the employee deduction limits for deductions with an ongoing/cumulative limit by reducing the limit by the amount deducted for the calendar year. Updating the deduction limits is the main reason for running this application. Additionally, this process inserts the YTD Unspent column amount into the Prior Yr. Unspent column on the Manage Employee Savings Bonds screen. It also changes the YTD Unspent, Spent amount, and No. Bought to zero.

You close the payroll year once each calendar year at the end of the calendar year. The payroll year close is based on the calendar year rather than the fiscal year because of IRS and state tax filing requirements. Closing the payroll is more than just running a particular program at the right time. It is important that the close be performed at the proper time between pay periods. See the Hints at the end of this page for more detailed instructions.

Execute this process AFTER posting all payroll checks dated in the current calendar year through the Payroll Journal. This ensures that all current year wages and deductions appear properly on the W-2s, quarterly payroll reports, and the year-to-date Earnings Report. You can add additional compensation and taxable fringe benefits on the Manage Employee Earnings History screen after the calendar year is closed, and before quarterly reports and W-2s are printed.

Execute this process BEFORE computing payroll that is paid in the future year. You can enter the timesheets before closing the payroll year, but do not create payroll that is paid in the future year until the payroll year is closed. Improper deduction amounts may result.