Parameters
A value must be set for the SECACTCALC parameter. This parameter has two options: Prorate and Pretax.
Prorate: Both Pretax and After-Tax Calculations are combined proportionally to determine if the threshold is reached.
Pretax: Only Pretax Calculation is used to check if the threshold is reached.
Pay Calculation Setup
Set up your pre-tax and post-tax pay calculations as you had prior to the Secure 2.0 Act.
In Global Setup > US Specifics > Combined Pay Calculations, set up your combined pay calculation for your pre-tax and post tax deferrals.
Note: You must dormant the existing combined calculation and create a newly effective-dated combined calculation.
New Fields
Subject to Secure Act 2.0: Whether the combined pay calculation is a subject of the Secure Act 2.0. If the combined pay calculation is a subject of the Secure Act 2.0, the Pay Calcs to Combine list must have only two pay calculations - Pretax Calc and After Tax Calc.
Pretax Calc: If the combined pay calculation is a subject of the Secure Act 2.0, the Pretax Pay Calculation cannot be blank and must be included in the Pay Calcs to Combine list.
After Tax Calc: If the combined pay calculation is a subject of the Secure Act 2.0, the After Tax Pay Calculation cannot be blank and must be included in the Pay Calcs to Combine list.
Pretax Match: Pretax match pay calculation for Secure Act 2.0.
After Tax Match: After tax match pay calculation for Secure Act 2.0.
High Earner Catchup Threshold: If the combined pay calculation is a subject of the Secure Act 2.0, the High Earner Catchup Threshold cannot be zero or negative.
Pretax Calculation as After Tax Calc: Whether to treat pretax calc contributions as a deemed election to after tax calc for high wage earners if the High Earner Catchup Threshold has been met.
Benefit Plan Setup
If using Human Resources and benefits, create benefit plans for both the pre-tax and post-tax calculations and their matches.
Plan Workbench
Pre-tax Benefit Plan
Post-tax Benefit Plan
Employee Setup
Once it is determined that an employee is a high wage earner, check the ‘High Earner for Secure Act 2.0’ checkbox on the Employee Maintenance > Employee Detail > Tax Authority Details page.
If using benefit plans, enroll your employee into the plans. Employees must be enrolled in both plans, even if there is a $0.00 or 0% deferral.
If using benefit plans, an employee’s pay calculations will automatically be created with their deferral and matching schedules for both benefit plans. If you are not using benefit plans, your pay calculations for both pre-tax and post-tax and their respective matching schedule calculations will need to be added on the Employee Maintenance > Pay Calculations page.
Reporting
There is a dedicated global report for this legislation called Calculation Report (For Secure Act 2.0).
