Sage 50 US Payroll Tax Update – Download and Install

Accelerated Retirement Catch-Up Limits Under the SECURE 2.0 Act

The SECURE 2.0 Act introduces higher catch-up contribution limits for employees between the ages of 60 and 63 who participate in eligible retirement plans.

State and Local Tax Changes

• Arkansas State Income Tax: Withholding table and standard deduction changes.
• Illinois State Income Tax: Withholding tax rate change.
• Indiana State Income Tax: Withholding tax rate change.
• Louisiana State Income Tax: Withholding formula changes.
• Montana State Income Tax: Withholding table changes.
• North Carolina State Income Tax: Withholding formula changes.
• North Dakota State Income Tax: Withholding table changes.
• Oregon State Income Tax: Updates include changes to withholding tables, federal tax adjustments, and personal exemptions.
• Rhode Island Temporary Disability: Wage base and contribution rate changes.
• Vermont State Income Tax: Withholding table and withholding allowance changes.

2025 State Unemployment Wage Limits

Here are the state unemployment wage limits for the 2025 tax year.

Bold and Red text indicates a Wage Base Limit change included in the February 2025 tax update.

Payroll Tax Forms Update

Payroll tax forms were updated in the Payroll Tax Form Selector window on or after December 20, 2024. To receive updates, select any Federal or State form and click Next. If an update is available, the next window will give you the option to automatically update your forms. It’s strongly recommended to install all available updates.

Important: The payroll forms update also refreshes the form lists in the Payroll Tax Form Selector window. If you’re preparing a year-end 2024 form (such as W-2, 940, 943, or 945) but only see 2023 forms:

• Select the 2023 form you need and click OK.
• With an active Sage 50 subscription, the next window will prompt you to update your forms.
• Once updated, the 2024 year-end forms will appear in the Payroll Tax Form Selector window.

Special Note: All forms provided in Sage 50 are approved by the respective taxing authorities. Some states have not yet finalized approval for their forms. Any form awaiting approval that can still be printed and mailed will display the banner “Record Copy Do Not File.” This banner will be removed as soon as the taxing agency approves the form. Periodic online updates for these forms will be available through the Automatic Update feature in Payroll Tax Forms.

Making Sure That Your Tax Update is Applied

The tax update version is 20250201 for Release 2024. Follow the steps below to confirm the update was successfully applied:

For Release 2024:

• Open your Sage 50 company.
• Go to Help > About Sage 50 Accounting.
• Verify that the Installed Tax Update version number matches 20250201.

Getting Help and Customer Support

For assistance, we offer built-in help resources, online knowledge articles, and customer support services. You can access help directly within the software, explore step-by-step guides, or reach out to the support team for updates or payroll and tax-related questions.

This bulletin describes the changes included in the Sage 50 Payroll Solutions Update, released on January 2, 2025, for Sage 50 Accounting, Release 2024.

Federal Tax Changes

Federal Income Tax Withholding

The 2025 withholding tax tables have been updated. New filing statuses apply to employees who use the revised W-4 form (introduced in 2020). The previous filing statuses remain available for employees who continue using the 2019 or earlier version of the form.

State and Local Tax Changes

Alabama State Income Tax: The overtime exemption formula name has been changed from ALSIT back to ALSITT.

2025 State Unemployment Wage Limits

Here are the state unemployment wage limits for the 2025 tax year.

Note: The Wage Base Limit changes on January 2nd, 2025. Tax updates are shown in bold and red.

Payroll Tax Forms 

Payroll tax forms were updated in the Payroll Tax Form Selector window on or after December 20, 2024. To check for updates, select a Federal or State form and click Next. If an update is available, the next window will give you the option to update your forms automatically. It is strongly recommended to install all available updates.

Note: The payroll forms update also refreshes the list of forms in the Payroll Tax Form Selector window. If you need to run a year-end 2024 form, such as W-2, 940, 943, or 945, but only see 2023 forms listed, then: [insert next step].

• Select the 2023 form you need and click OK.
• With an active Sage 50 subscription, the next window will prompt you to update your forms.
• After completing the update, the 2024 year-end forms will appear in the Payroll Tax Form Selector window.

Note: The taxing authorities approve all payroll tax forms in Sage 50. Some states have not yet finalized approval for their forms. Forms that can be printed and mailed but are still awaiting approval will show the banner “Record Copy Do Not File.” This banner will be removed once the taxing agency approves. Periodic online updates for these forms will be released through the Automatic Update feature in Payroll Tax Form.

Making Sure That Your Tax Update is Applied

The tax update version is 20250102 for Release 2024. Follow these steps to confirm the update is installed:

For Release 2024:

• Open your Sage 50 company.
• Go to Help > About Sage 50 Accounting.
• Verify that the Installed Tax Update version number matches 20250102.

Getting Help and Customer Support

You can find helpful information directly in your Sage 50 application. Click the Help button in the toolbar or press F1 while in a field to open Help and get answers.

This release provides details of the changes included in the January 2025 Sage 50 Payroll Solutions Update for Sage 50 Accounting, Release 2024. It highlights the latest payroll and tax-related updates to ensure compliance with new regulations effective from January 1, 2025.

Federal Tax Changes

Federal Income Tax Withholding

Important Note: The 1st January 2025 payroll tax update includes draft changes for Federal Income Tax (FIT) withholding. Finalized changes will be released in the 2nd January 2025 payroll tax update, expected in mid-January. Please note that the new filing statuses introduced with the revised W-4 Form (2020 onward) remain in use, while the previous filing statuses continue to apply for employees who submitted a W-4 from 2019 or earlier.

Social Security Wage Base

The Social Security wage base has increased to $176,100 for the 2025 tax year. Wages earned above this limit are not subject to Social Security tax withholding.

State and Local Tax Changes

• California: Withholding tax rate changed.
• California State Income Tax: Standard deduction and withholding table changes.
• Colorado Family and Medical Leave Insurance: Taxable wage limit updated to match the Social Security limit.
• Colorado State Income Tax: Withholding tax changes for employees using form DR_0004.
• Connecticut Paid Family Leave: Taxable wage limit updated to the Social Security limit.
• Delaware Paid Family and Medical Leave: New contributions begin January 2025.
• Hawaii State Income Tax: Withholding allowances and tables updated.
• Hawaii Temporary Disability Insurance: Annual wage limit changed.
• Iowa State Income Tax: Withholding tables and formulas have been updated. The Iowa withholding formula and the IA W-4 have been revised for the 2025 tax year to reflect individual income tax changes mandated by Iowa Senate File 2442.
• Kentucky State Income Tax: Standard deduction and tax rate changes.
• Massachusetts Paid Family and Medical Leave: Taxable wage limit tied to the Social Security limit.
• Massachusetts State Income Tax: Annual high threshold amount updated.
• Maine Paid Family and Medical Leave: New contributions begin January 2025.
• Maine State Income Tax: Withholding tables and standard deduction updated.
• Michigan State Income Tax: Tax rate and personal exemption changes.
• Minnesota State Income Tax: Allowance and withholding tables updated.
• Mississippi State Income Tax: Withholding tax rate change.
• Missouri State Income Tax: Withholding tables and standard deduction updated.
• Nebraska State Income Tax: Withholding tables and allowances updated.
• New Jersey State Disability Insurance: Taxable wage base and rate changes.
• New Jersey Family Leave Insurance: Taxable wage base and rate changes.
• New Mexico State Income Tax: Withholding tables updated.
• Oregon Paid Family Leave: Taxable wage limit tied to the Social Security limit.
• Rhode Island State Income Tax: Withholding tables and exemption amounts updated.
• South Carolina State Income Tax: Withholding tables and allowances updated.
• Washington Paid Family Leave: Taxable wage base and rate changes.
• West Virginia State Income Tax: Withholding tables updated.

2025 State Unemployment Wage Limits

The following state unemployment wage limits apply for the tax year 2025.

Note: Text shown in Bold and Red highlights the Wage Base Limit changes included in the January 2025 tax update.

Payroll Tax Forms Update

The payroll tax forms were refreshed in the Payroll Tax Form Selector window on or after December 20, 2024. To check for updates, select a federal or state form and click Next. If an update is available, the next window will provide an option to update your forms automatically. It is strongly recommended to install all available form updates.

Note: The payroll forms update also refreshes the list of forms displayed in the Payroll Tax Form Selector window. If you attempt to run a year-end 2024 form (such as W-2, 940, 943, or 945) but only see the 2023 forms, follow these steps:

• Select the 2023 form you need and click OK.
• If you have an active Sage 50 subscription, the next window will prompt you to update your forms.
• After completing the forms update, the 2024 year-end forms will appear in the Payroll Tax Form Selector window.

Special Note: The respective taxing authorities approve the forms supplied by Sage 50. However, a few states have not yet finalized approval for their forms. Any form that is still pending approval but can be printed and mailed will display the banner “Record Copy Do Not File.” Once the taxing agencies approve, the “Record Copy” banner will be removed. These updates will be delivered periodically through the Automatic Update feature in the Payroll Tax Form module.

Making Sure That Your Tax Update is Applied

The version for this tax update is 20250101 for Release 2024. Follow the steps below to verify that the update has been successfully applied:

For Release 2024:

• Open your Sage 50 company.
• Go to Help > About Sage 50 Accounting.
• Check that the Installed Tax Update version number matches 20250101.

Getting Help and Customer Support 

The built-in Help feature in Sage 50 is a valuable resource for guidance. You can access it directly from any Sage 50 window by clicking the Help button in the toolbar or by pressing the F1 key while in a field.

Sage 50 offers multiple support options to assist you. Use the built-in Help feature by clicking the toolbar button or pressing F1 for quick guidance. For more detailed solutions, visit the Sage Knowledgebase, connect with the Sage City community, or reach out to the Accountspro support team through your subscription plan. These resources ensure you get timely help with updates, payroll, and accounting tasks.

State and Local Tax Changes

• Arkansas State Income Tax: Standard deduction amounts and withholding tables have been updated.
• Kansas State Income Tax: Withholding tables have been updated. Allowance amounts have changed for all filing statuses, and a new Dependent Allowance has been introduced.
• South Carolina State Income Tax: Withholding rate change.

2024 State Unemployment Wage Limits

The state unemployment wage limits listed below apply for the 2024 tax year.

Text in bold red highlights the Wage Base Limit changes from the October 2024 tax update.

Payroll Tax Forms Update

Payroll tax forms in the Payroll Tax Form Selector window were updated on or after December 20, 2023. To check for updates, select a federal or state form and click Next. If an update is available, the next window will prompt you to automatically update your forms. It is strongly recommended to install all available updates.

Note: The update also refreshes the list of forms in the Payroll Tax Form Selector window. If you try to run a year-end 2023 form (such as W-2, 940, 943, or 945) but only see the 2022 forms, follow the update steps to access the correct 2023 forms.

• Select the 2022 form you need and click OK.
• If you have an active Sage 50 subscription, the next window will prompt you to update your forms.
• Once the update is complete, the 2023 year-end forms will appear in the Payroll Tax Form Selector window.

Special Note: Sage 50 forms are approved by the respective taxing authorities. Some states are still pending approval. Any form that can be printed and mailed but is awaiting approval will display the banner “Record Copy Do Not File.” This banner will be removed once the forms are approved. Periodic updates for these forms will be provided via the Automatic Update feature in Payroll Tax.

Making Sure That Your Tax Update is Applied

The version for this tax update is 20241001 for Release 2024. To verify that the update has been applied:

For Release 2024:

• Open your Sage 50 company.
• Go to Help > About Sage 50 Accounting.
• Check that the Installed Tax Update version number matches 20241001.

Getting Help and Customer Support

Sage 50 includes a built-in Help feature, which you can access from any window by clicking the Help button in the toolbar or pressing F1 while in a field. You can use this feature for instant guidance, visit the Sage Knowledgebase for detailed articles, join the Sage City community to ask questions, or contact the Sage customer support team through your subscription. These resources help you resolve issues quickly and keep your accounting and payroll processes running smoothly.

This bulletin outlines the changes included in the July 2024 Sage 50 Payroll Solutions Update for Sage 50 Accounting, Release 2024.

Federal Tax Changes

Federal Income Tax Withholding

The 2024 withholding tax tables changed on January 1, 2024. The new filing statuses from the revised 2020 W-4 Form remain in place, while the prior statuses still apply to employees using the 2019 or earlier version of the form.

State and Local Tax Changes

• DC Paid Family Leave: Withholding rate updated.
• Georgia State Income Tax: Withholding tax changes applied.
• Georgia State Income Tax: Correction made to GA Additional Withholding.
• Idaho State Income Tax: Withholding table and allowance updates.
• Ohio State Income Tax: Withholding Table and Allowance updates.
• Oregon TriMet Transit District (TM): Tax rate updated.
• Oregon Lane Transit District (LTD): Tax rate updated.
• Utah State Income Tax: Withholding tax changes applied.
• Virginia State Income Tax: Standard deduction updated.
• New Jersey State Unemployment Insurance (SUI) Tax: Added a 0.0425% Workforce Development Fund (WF) contribution.
• Vermont Child Care Contribution Tax: New tax effective July 1, 2024.

Correction to resolve 2-factor authentication and Direct Deposit Sync Error when SMS Text is used.

This update fixes an issue that could stop Direct Deposit sync when two-factor authentication is enabled with SMS text.

2024 State Unemployment Wage Limits

The state unemployment wage limits listed below apply for the 2024 tax year.

Bold and Red text shows the Wage Base Limit changes in the July 2024 tax update.

Payroll Tax Forms Update

Payroll Tax Forms: The payroll tax forms were updated in the Payroll Tax Form Selector window on or after December 20, 2023. To receive an update, select a Federal or State form and click Next. If an update is available, the next window will give you the option to update your forms automatically. It is recommended that you install all form updates.

NOTE: The payroll forms update also refreshes the forms list in the Payroll Tax Form Selector window. If you are trying to run a year-end 2023 form, such as W-2, 940, 943, or 945, but only see the 2022 forms listed:

• Select the 2022 form you need and click OK.
• If you have an active Sage 50 subscription, the next window will prompt you to update your forms.
• After completing the update, the 2023 year-end forms will appear in the Payroll Tax Form Selector window.

Special Note: The forms provided in Sage 50 are approved by the taxing authorities. Some states have not finalized their approvals. Any form that can be printed and mailed but is still pending approval will display the banner “Record Copy Do Not File.” Sage 50 will remove this banner once the taxing agencies approve the forms. Periodic online updates for these forms are delivered through the Automatic Update feature in Payroll Tax Form.

Making Sure That Your Tax Update is Applied

The tax update version is 20240701 for Release 2024. Follow these steps to verify that the update has been applied:

For Release 2024:

• Open your Sage 50 company.
• Go to Help > About Sage 50 Accounting.
• Check that the Installed Tax Update version number matches 20240701.

Getting Help and Customer Support

Help within your Sage 50 application is a valuable source of information. You can access it from any Sage 50 window by clicking the Help button in the toolbar or pressing the F1 key while in a field.

This bulletin outlines the updates included in the January 2, 2024, Sage 50 Payroll Solutions Update for Sage 50 Accounting, applicable to Releases 2023 and 2024.

Federal Tax Changes

The 2024 federal withholding tax tables have been updated. Employees using the revised 2020 W-4 form should follow the new filing statuses, while those using the 2019 or earlier versions of the form will continue with the previous filing statuses.

State and Local Tax Changes

• Alabama State Income Tax: Updated overtime exemption.
• Georgia State Income Tax: Revised withholding tables and allowances.
• Iowa State Income Tax: Updated withholding tables and allowances.
• Illinois State Income Tax: Standard allowance updated.
• Indiana State Income Tax: Changes to withholding rates.
• Massachusetts State Income Tax: Updated wage base and contribution rates.
• Maryland State Income Tax: Revised withholding tables and standard deductions.
• Mississippi State Income Tax: Updated withholding rates and personal exemptions.
• North Carolina State Income Tax: Changes to withholding rates.
• North Dakota State Income Tax: Updated withholding tables.
• Rhode Island Temporary Disability Insurance: Updated wage base and contribution rates.
• Vermont State Income Tax: Changes to withholding tables.

Sage HR Integration Updates for Sage 50 U.S. Release 2024.0.1

Sage HR Integration and Sync Updates: Several fixes to issues and enhancements to functionality were delivered in this update.

2024 State Unemployment Wage Limits

The state unemployment wage limits listed below are applicable for 2024.

Text in bold red highlights wage base limits that were updated in the January 2, 2024, release.

Payroll Tax Forms Update

Payroll tax forms were updated in the Payroll Tax Form Selector window on or after December 20, 2023. To apply an update, select a Federal or State form and click Next. If an update is available, the next window will provide an option to automatically update your forms. It is strongly recommended to apply all available form updates.

Note: Updating payroll forms also refreshes the forms list in the Payroll Tax Form Selector window. If you need to run a 2023 year-end form, such as W-2s or 940/943/945, but only see 2022 forms:

• Select the 2022 form you want.
• Click OK.
• If your Sage 50 subscription is current, the next window will prompt you to update your forms.
• After completing the update, the 2023 year-end forms will appear in the Payroll Tax Form Selector window.

Special Note: Sage 50 forms are approved by the relevant tax authorities. Some states have not approved their forms yet. Any form that you can print and mail but is still waiting for approval, will show the banner “Record Copy Do Not File.” This banner will be removed once the authorities approve the form.

Sage 50 updates these forms online through the Automatic Update feature in Payroll Tax Forms.

Making Sure That Your Tax Update is Applied

The tax update version 20240102 applies to Sage 50 Accounting Releases 2023 and 2024.

For Releases 2023 and 2024:

• Open your Sage 50 company.
• Go to Help > About Sage 50 Accounting.
• Confirm that the Installed Tax Update version number matches 20240102.

Getting Help and Customer Support

Help within Sage 50 provides valuable information. You can access it from any Sage 50 window by clicking the Help button in the toolbar or pressing F1 while on a field. For guidance with the January 2, 2024, Tax Update, you can use the Sage Knowledgebase for detailed articles and step-by-step instructions, connect with other users in the Sage City community to ask questions and share tips, or contact Sage Customer Support for help with installation, tax updates, or technical issues.

This release details the January 1, 2024, Sage 50 Payroll Solutions Update for Sage 50 Accounting Releases 2023 and 2024.

Federal Tax Changes

Federal Income Tax Withholding

Sage 50 now includes the 2024 federal income tax withholding tables. The update adds the new filing statuses from the revised 2020 W-4 Form. Previous filing statuses remain available for employees using the 2019 or earlier versions of the form.

Social Security Wage Base

The 2024 Social Security wage base has increased to $168,600.

State and Local Tax Changes

• Alabama State Income Tax: Overtime exemption added.
• Arkansas State Income Tax: Withholding table and allowance updates.
• California Disability Insurance: Withholding rate and taxable wage limit updated.
• California State Income Tax: Withholding table and standard deduction updated. New filing statuses added: Head of Household, Married, Single, and Married/2 Incomes.
• Colorado Family and Medical Leave Insurance: Withholding rate and taxable wage limit updated.
• Colorado State Income Tax: Withholding rate updated.
• Connecticut Paid Family Leave: Withholding rate updated.
• Connecticut State Income Tax: Withholding table and allowance updates. Phase-out add-back changes applied. New recapture provision added.
• Hawaii Temporary Disability Insurance: Annual wage limit updated.
• Illinois State Income Tax: 2023 catch-up allowance removed. Standard allowance updated.
• Indiana State Income Tax: A New first-time dependent allowance added.
• Kentucky State Income Tax: Allowance updates applied.
• Massachusetts State Income Tax: Wage base and contribution rate updated.
• Massachusetts Paid Family and Medical Leave: Wage base and contribution rate updated.
• Maine State Income Tax: Withholding table updated. Phase-out and standard deduction changes applied.
• Mississippi State Income Tax: Withholding rate updated. Personal exemption changes applied.
• Missouri State Income Tax: Withholding table and standard deduction updated.
• Montana State Income Tax: Withholding table and standard deduction updated. New filing statuses added: Married/2 Incomes, Qualifying Widow(er), and Head of Household.
• Nebraska State Income Tax: Withholding table and allowance updates.
• New Jersey State Disability Insurance: Taxable wage base and rate updated.
• New Jersey Family Leave Insurance: Taxable wage base and rate updated.
• New Mexico State Income Tax: Withholding table updated.
• New York Paid Family Leave: Taxable wage base and rate updated.
• Ohio State Income Tax: Withholding table updated.
• Oklahoma State Income Tax: Withholding table updated.
• Oregon Paid Family Leave: Taxable wage base updated.
• Oregon State Income Tax: Withholding table and allowance updates.
• Rhode Island State Income Tax: Withholding table and allowance updates.
• South Carolina State Income Tax: Withholding table and allowance updates.
• Washington Paid Family Leave: Taxable wage base and rate updated.

2024 State Unemployment Wage Limits

The following state unemployment wage limits apply for 2024. For instructions on applying these limits in your state, refer to the articles available in the Year-End Center.

Bold and Red text shows the Wage Base Limit changes included in the January 2024 update.

Payroll Tax Forms

Payroll tax forms were updated in the Payroll Tax Form Selector window on or after December 20, 2023. To check for updates, select a Federal or State form and click Next. If an update is available, the next window will let you update your forms automatically. Applying all available updates is strongly recommended.

Note: Updating payroll forms also refreshes the forms list in the Payroll Tax Form Selector window. If you are using a 2023 year-end form (such as W-2, 940, 943, or 945) but see only 2022 versions, follow these steps:

• Select the 2022 form you need and click OK.
• If you have a current Sage 50 subscription, the next window will prompt you to update your forms.
• After updating, the 2023 year-end forms will appear in the Payroll Tax Form Selector window.

Special Note: All Sage 50 forms are approved by the taxing authorities. Some states have not yet finalized their approvals. Forms that can be printed and mailed but are still awaiting approval will display the banner “Record Copy Do Not File.” This banner will be removed once the form is approved. Periodic online updates for these forms are delivered through the Automatic Update feature in Payroll Tax Form.

Making Sure That Your Tax Update is Applied

The version for this tax update is 20240101 for Releases 2023 and 2024. Follow these steps to confirm the update was applied:

For Releases 2023 and 2024:

• Open your Sage 50 company.
• Go to Help > About Sage 50 Accounting.
• Verify that the Installed Tax Update version number matches 20240101.

Getting Help and Customer Support

Help within your Sage 50 application is a great source of information. You can access it from any Sage 50 window by clicking the Help button in the toolbar or pressing the F1 key while on a field. You can also use the Sage Knowledgebase, join the Sage City community, or contact Sage Customer Support for further assistance.

This release outlines the changes in the July 2023 Sage 50 Payroll Solutions Update for Sage 50 Accounting, Release 2023.

State and Local Tax Changes

• Arkansas State Income Tax: Updated withholding tables.
• Idaho State Income Tax: Updated withholding tables and allowance information.
• Illinois State Income Tax: Updated exemption allowances, including the catch-up withholding addendum.
• North Dakota State Income Tax: Updated withholding tables.
• Washington Cares Fund Tax: Employees in Washington state begin contributing to the WA Cares Fund tax starting July 2023.
• Pennsylvania – City of Philadelphia (Residents): Wage tax rate change.

2023 State Unemployment Wage Limits

The state unemployment wage limits listed below apply for 2023.

Bold and Red text indicates a wage base limit that changed in the July 2023 update.

Payroll Tax Forms

The payroll tax forms were updated within the Payroll Tax Form Selector window on or after July 12, 2023. To receive an update, select a Federal or State form and click on Next. If an update is available, the next window will have an option to automatically update your forms. It is strongly recommended that you apply all form updates.

NOTE: The payroll forms update also refreshes the forms list in the Payroll Tax Form Selector window. If you are trying to run a year-end 2022 form, such as W-2, 940, 943, or 945, but only see the 2021 forms listed, then:

• Select the 2021 form that you want and click on OK.
• If you have a current Sage 50 subscription, the next window will prompt you to update your forms.
• After updating, you will see the 2022 year-end forms listed in the Payroll Tax Form Selector window.

Special Note: The forms provided by Sage 50 are approved by the taxing authorities. A few states have not yet approved their forms. Any form that can be printed and mailed and is awaiting approval will display the banner “Record Copy Do Not File”. This banner will be removed as the taxing agencies approve the forms. Periodic online updates for these forms are available through the Automatic Update feature in the Payroll Tax Form Selector.

Making Sure That Your Tax Update is Applied

The version for this tax update is 20230701 for release 2023. Follow these steps to make sure your tax update was applied:

For Release 2023:

• Open your Sage 50 company.
• Select Help > About Sage 50 Accounting.
• Confirm that the Installed Tax Update version number matches the version number listed above.

Getting Help and Customer Support

You can access help within your Sage 50 application by clicking the Help button in the toolbar or pressing F1 on any field. For additional guidance with the July 2023 Tax Update, refer to the Sage Knowledgebase, connect with the Sage City community, or contact Sage Customer Support for direct assistance.

This release outlines the changes included in the Sage 50 Payroll Solutions Update released on 2nd January 2023 for Sage 50 Accounting, versions 2022 and 2023.

Federal Tax Changes

Federal Income Tax Withholding

The 2023 federal income tax withholding tables have been updated. Employees using the 2020 or later W-4 form should follow the new filing statuses. Employees using the 2019 or earlier version of the form will continue with the previous filing statuses.

State and Local Tax Changes

• Connecticut Paid Family Leave: Wage base updated.
• Illinois State Income Tax: Withholding and contribution rates updated.
• Indiana State Income Tax: Withholding and contribution rates updated.
• Maryland State Income Tax: Withholding table and standard deduction updated.
• Michigan State Income Tax: Personal exemption amount updated.
• North Carolina State Income Tax: Annualized tax percentage updated.
• North Dakota State Income Tax: Withholding table updated.
• Oregon State Income Tax: Withholding table and standard deduction updated.
• Rhode Island State Income Tax: Withholding table and annual exemption wage limit updated.
• Rhode Island Temporary Disability Insurance: Taxable wage base updated.
• Vermont State Income Tax: Withholding table and allowance updated.
• Washington Paid Family Leave: Wage base and contribution rate updated.

2023 State Unemployment Wage Limits

The state unemployment wage limits listed below apply for 2023.

Text in Bold and Red indicates a wage base limit change in the 2nd January 2023 update.

Payroll Tax Forms

The payroll tax forms were updated within the Payroll Tax Form Selector window on or after December 20, 2022. To receive an update, select a Federal or State form and click on Next. If there is an update, the next window to appear will have an option to automatically update your forms. It is strongly recommended that you take all form updates.

NOTE: The payroll forms update also updates the forms lists that appear in the Payroll Tax Form Selector window. If you are trying to run a year-end 2022 form, such as W-2s, 940/943/945, but only see the 2021 forms listed, then:

• Select the 2021 form that you want and click on OK.
• If you have a current Sage 50 subscription, the next window will prompt you to update your forms.
• After taking the forms update, you will see the 2022 year-end forms listed in the Payroll Tax Form Selector window.

Special Note: The forms provided by Sage 50 are approved by the taxing authorities. A few states have not yet approved their forms. Any form that can be printed and mailed, and is awaiting approval, will print with the banner “Record Copy Do Not File”. We will be removing the “Record Copy” as the taxing agencies approve the forms. There will be periodic online updates for these forms via the Automatic Update feature in the Payroll Tax form.

Making Sure That Your Tax Update is Applied

The version for this tax update is 20230102 for releases 2022 and 2023. Follow these steps to make sure that your tax update was applied:

For Release 2022 and 2023:

• Open your Sage 50 company.
• Select Help > About Sage 50 Accounting.
• Confirm that the Installed Tax Update version number matches the version number listed above.

Getting Help and Customer Support

Help within your Sage 50 application is a valuable resource. You can access it from any Sage 50 window by clicking the Help button in the toolbar or pressing F1 while on a field. For additional guidance with the 2nd January 2023 Tax Update, you can refer to the Sage Knowledgebase for detailed articles, connect with other users in the Sage City community to ask questions and share tips, or contact Sage Customer Support for direct assistance.

This release outlines the changes in the 1st January 2023 Sage 50 Payroll Solutions Update for Sage 50 Accounting, Releases 2022 and 2023.

Federal Tax Changes

1. Federal Income Tax Withholding

The 2023 federal withholding tax tables have been updated. New filing statuses are based on the revised 2020 W-4 Form. Employees using the 2019 or earlier version of the form will continue with the previous filing statuses.

2. Social Security Wage Base

The 2023 Social Security wage base has increased to $160,200.

State and Local Tax Changes

• Arizona State Income Tax: The withholding percentage has changed.
• California Disability Insurance: The withholding rate and taxable wage limit have changed.
• California State Income Tax: The withholding tables and standard deduction have changed.
• Colorado Family and Medical Leave Insurance: Colorado introduced a new state-run Paid Family and Medical Leave Insurance program starting 1st January 2023.
• Colorado State Income Tax: Withholding changes now support Form DR0004. New filing statuses have been added for Married Filing Separately and Qualifying Widow(er).
• Hawaii Temporary Disability Insurance: The annual wage limit and deduction rate have changed.
• Iowa State Income Tax: Withholding tables and formulas have been updated.
• Kentucky State Income Tax: The standard deduction and withholding rate have changed.
• Maine State Income Tax: Withholding tables and the standard deduction have been revised.
• Massachusetts Paid Family Leave: The Wage base and contribution rate have changed.
• Missouri State Income Tax: Withholding tables have changed. A new filing status, Married Filing Separately, has been added.
• Mississippi State Income Tax: Withholding tables and the standard deduction have been updated.
• Minnesota State Income Tax: Withholding tables and the standard deduction have been revised.
• Montana State Income Tax: Withholding tables have changed.
• Nebraska State Income Tax: Withholding allowances and tables have been updated.
• New Jersey State Disability Insurance, Unemployment Insurance, Family Leave Insurance, and State Income Tax: The Taxable wage base and rates have changed. Click here for NJFLI information.
• New Mexico State Income Tax: Withholding tables have been updated.
• New York Paid Family Leave: The weekly wage base limit and contribution rate have changed.
• New York State Income Tax: Withholding tables have been revised.
• New York Yonkers Local Income Tax: Withholding tables have changed.
• Oregon Paid Leave: Oregon introduced a state-run Paid Leave program starting 1st January 2023.
• South Carolina State Income Tax: Personal allowances, standard deductions, and withholding tables have been updated.

2023 State Unemployment Wage Limits

Here are the state unemployment wage limits for 2023.

Bold and Red text shows the Wage Base Limit updated in January 2023.

Payroll Tax Forms

Payroll tax forms will be updated in the Payroll Tax Form Selector window on or after December 20, 2022. To check for updates, select a Federal or State form and click Next. If an update is available, the next window will give you the option to update your forms automatically. It is strongly recommended that you install all form updates.

Note: The payroll forms update also refreshes the forms list in the Payroll Tax Form Selector window. If you need to run a year-end 2022 form, such as W-2, 940, 943, or 945, but only see 2021 forms:

• Select the 2021 form you want and click OK.
• With a current Sage 50 subscription, the next window will prompt you to update your forms.
• After updating, the 2022 year-end forms will appear in the Payroll Tax Form Selector window.

Special Note: All forms in Sage 50 are approved by taxing authorities. Some states have not yet finalized approval for their forms. Any form that can be printed and mailed but is still waiting for approval will display the banner “Record Copy Do Not File.” This banner will be removed once approval is granted.

Making Sure That Your Tax Update is Applied

Tax Update Version is 20230101. This version applies to Releases 2022 and 2023. Follow these steps to confirm the update was applied:

• Open your Sage 50 company.
• Go to Help > About Sage 50 Accounting.
• Verify that the Installed Tax Update version number matches 20230101.

Getting Help and Customer Support

Help in Sage 50 provides quick answers. You can access it by clicking the Help button in any window or pressing F1. For more details on the January 1, 2023, Tax Update, visit the Sage Knowledgebase for guides and step-by-step instructions, connect with other users in the Sage City Community to ask questions and share tips, or contact Sage Customer Support for direct assistance.

Question: What is the Sage 50 US Tax Update?

Answer: The Sage 50 US Tax Update keeps your payroll and accounting software current with federal and state tax laws. It updates tax rates, withholding tables, and payroll calculations.

Question: How do I know which tax update version I have installed?

Answer: Open your Sage 50 company. Go to Help > About Sage 50 Accounting. The installed tax update version will appear. Compare it with the latest release to confirm it is up to date.

Question: How do I install a Sage 50 Tax Update?

Answer: Below are the steps:

• Close all Sage 50 windows.
• Open Sage 50 and select Help > Check for Updates.
• Follow the prompts to download and install the update.
• Restart Sage 50 after the installation finishes.

Question: Do I need a specific Sage 50 release to apply a tax update?

Answer: Yes, each tax update works with specific releases, such as 2022, 2023, or 2024. Ensure your Sage 50 version matches the update requirements.

Question: Will the update change my historical payroll data?

Answer: No, the tax update only affects current and future payroll calculations. Past payroll records remain unchanged.

Question: What if a state has not finalized its tax form approval?

Answer: Forms that are not yet approved display the banner “Record Copy Do Not File”. Once the state approves them, Sage 50 removes the banner automatically. You can print and file all approved forms.

Question: How often are tax updates released?

Answer: Sage releases tax updates periodically, usually at the start of a new year or when major federal or state changes affect payroll.