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Administrator Guide
Last Updated: 2023-06-23
Concept: Aggregate Federal Wages (USA)

Concept: Aggregate Federal Wages (USA)

Workday enables you to aggregate federal wages across multiple pay results in the same pay period to help you calculate standard tax withholding. You can aggregate wages for:
  • Pay on-demand results.
  • On-cycle results.
  • Off-cycle results in a regular pay period.
  • Multiple results across related companies in a company relationship.
Workday aggregates the wages of all pay results in the pay period for the run category you specify, regardless of whether you enabled aggregate wages for previous pay results.
Workday uses the current tax election when you calculate the withholding tax amount for the workers. When there’s a tax election change, Workday applies the current tax election to the aggregated wages for the period when calculating the current pay result.

Example

John is a new hire at Global Modern Services and has 2 pay results in the same period. You have enabled aggregate federal wages, and you want to view how much withholding tax Workday calculated to be withheld.
Result Type
Period
Payment Date/Reversal Date
Pay Group Detail
Calculation Status
01/01/2023 - 01/15/2023 (Semi-monthly)
01/13/2023
USA Semi-Monthly (Regular)
In Progress
On-Demand Payment Additional
01/01/2023 - 01/15/2023 (Semi-monthly)
01/05/2023
USA Semi-Monthly (Regular)
Complete
Workday aggregates the wages from both pay results because:
  • They have the same pay period.
  • The status of the first payment is Complete.
As a payroll administrator, you drill down on the pay results of John to view how Workday calculates the standard withholding tax:
The first pay result is for a signing bonus of 2,500.00 USD.
You view how much withholding tax Workday calculated to be withheld:
Pay Component
Related Calculation
Amount
YTD
Federal Withholding [USA]
Standard Withholding Calculated Tax
227.52
227.52
The second pay result is for a salary of 2,500.00 USD and a bonus of 100.00 USD.
In the
Pay Accumulations / Balances
 tab, you view the aggregate wages that Workday uses to calculate withholding tax:
Pay Balance
Amount
Federal Standard Withholding Wages for Pay Period [USA]
5,000.00
In the
Gross to Net
 tab, you view how much withholding tax Workday calculated to be withheld, based on the aggregated wages:
Pay Component
Related Calculation
Amount
YTD
Federal Withholding [USA]
Standard Withholding Calculated Tax
558.98
786.50
Federal Withholding [USA]
Flat Rate Withholding Wages
100.00
100.00
Because you enabled aggregate federal wages, Workday calculates the withholding tax as if you paid both payments together. The aggregated wages are 5,000.00 USD, so Workday calculates the withholding tax to be 786.50 USD.
Workday then subtracts the standard withholding calculated tax of the first pay result from 786.50 USD. The withholding tax from the signing bonus was 227.52 USD, so Workday calculates the withholding tax for the second pay result to be 558.98 USD.
Because John has a bonus in the second pay result, Workday calculates the supplemental withholding tax amount to be 22.00 USD. Workday adds this amount to the withholding tax amount calculated from the salary.
As a result, the total federal withholding amount for the second pay result will be 580.98 USD.