Imputed Earnings Not Taxed for Prior Payroll Runs – Recovery Approach

Summary:

We have a scenario in Oracle Fusion US Payroll where:

• An element 'XX Dental' was defined with:
  • Primary Classification: Imputed Earnings
  • Secondary Classification: Domestic Partner Dependent
• Due to this setup, the element was treated as non-taxable, and:
  • Federal Income Tax (FIT)
  • FICA (Social Security & Medicare)
  • State Income Tax (SIT)
    were not deducted
• The client has already processed ~12 payroll runs with this configuration.

** Business Requirement

• Recover missed taxes for the previous 12 payroll periods
• Client does NOT want to run Retro Payroll
• Prefer a payroll-driven approach (within regular payroll runs)

possible solutions :

Option 1: Adjustment via New Elements (Planned Approach)

• Create:
  • One additional