| To: | Personnel/Payroll Staff
Agency Fiscal Officers/Accounting Staff |
| Subject: | Information Regarding TXL and Labor Distribution |
| Sent Date: | 09/04/2008 |
TXL (Excess life Taxable Fringe) is an earnings code that is generated in payroll to tax employees for their term life insurance in excess of $50,000 per year per IRS guidelines. The earnings code is not a paid earnings to employees, it is an increase to their taxable gross, which in turn increases the withholding for FICA, Federal Tax, State Tax, retirement and unemployment insurance. Because TXL increases the employer share of monies paid to retirement, unemployment and FICA, the State Controller's Office has included this earnings code (TXL) on the Labor Distribution Reports for informational purposes only (the default distribution on the position control file will be used). The dollar amount will not be nor has ever been passed to STARS (Only gross amounts are passed).
Currently, the TXL earnings amounts are reported to the default distribution based on the information on the position control file and this becomes an issue when the agency overrides an employee's time to a different Index, PCA, grant, and/or project. When an distribution override exists, the TXL earnings code causes the employer benefits to be split between the default distribution and the override distribution in STARS. In most cases, the employer benefits are not expected to be reported to the default distribution on the position control distribution. This in turn causes the agencies numerous manual adjustments in STARS.
In an effort to prevent the additional adjustments mentioned above, the State Controller's Office is opting to remove the TXL earnings code from the Labor Distribution reports and files. If your agency is currently using the TXL on the Labor Distribution report/file for any purpose, please contact the DSP Helpdesk at 334-2394 to access this information in another way.
Additional notifications/information will be sent to notify those affected as changes occur.
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