In a recent ASUG webcast focused on SAP’s Human Capital Management (HCM) U.S. Payroll and Tax Reporter solutions, a set of SAP Globalization Services HCM engineers, developers, and product managers presented annual 2023 year-end updates.

The interactive Oct. 5 webcast (now available for replay; both the recording and slide deck are included with ASUG membership) was attended by more than 300 ASUG members; held annually, the HCM U.S. Payroll and Tax Reporting Year End Update webcast is designed to address enterprise customers’ critical workforce transformation needs and help HCM teams prepare for the end of the year. Below, a few high-level topics of discussion:

Exploring updates for the Tax Reporter component of SAP Payroll, which enables users to produce payroll tax and other reports for government authorities in the format required by each authority, the webcast also discussed year-end SAP notes including the U.S Tax Reporter Year End 2023 Announcement, Year End 2023 Phase I for U.S. Tax Reporter, TR: Year End 2023 Phase II for U.S. Tax Reporter, and W-2 / 1099-R Forms, Envelopes, and PR Approval for year 2023. (All require SAP S-ID for access.)

Reinhard Andreaus, Engineering Lead with SAP Globalization Services HCM Development, shared:

  • A series of BSI TaxFactory 11 announcements, including changes related to cyclics and regulatory bulletins
  • A legal change for the State of Indiana tax withholding (plus new SAP notes related to the change)
  • Improvements that have been made to SAP ‘s HCM U.S. Payroll Reconciliation Report (included reduced memory consumption and improved runtime)
  • Changes to the HCM U.S. Benefits Management software, including changes related to Health Savings Accounts (HSAs) and the SECURE 2.0 Act intended to increasing savings opportunities for employees

Mani Kak, Local Product Manager/Expert with SAP Globalization Services HCM Product Management, next provided details on updates to the SAP HCM U.S. Tax Reporter product that covered:

  • Q3 and 2023 quarterly reporting, sharing all impacted forms (as well as SAP notes that delivered relevant changes)
  • Tax Reporter (PY-US-TR) product performance improvements and enhancements
  • A detailed update on Year End 2023 Tax Reporting, starting from Year End Phase I (including, for example, updates to W-2 forms for Colorado to enable reporting of paid family and medical leave in box 14 of the form)
  • Discussion of the IRS regulation for e-filing threshold, which takes effect in January and reduces the threshold for number of returns required to be electronically filed from 250 to 10, requiring filings to be aggregated
  • Required minimum HR Support Packs (HSRPs) for Year End legal change delivery and implementation via Country Legal Changes (CLCs), introduced to make it easier for companies with multi-country payroll implementations to implement legislative changes for specific countries, which contain SAP notes with bug fixes, minor enhancements, and legislative changes
  • Further SAP S/4HANA release and Tax Reporter Performance improvement topics, such as SAP_HR and EA_HR being combined in SAP S/4HANA

For the last part of the webcast, Kak introduced guest speaker Dagmar Becker, Product Manager/Expert with the SAP Application Innovation Services (AIS) team, who discussed the future of on-premises SAP HCM, explaining that customers can continue to run SAP ERP HCM in SAP Business Suite until 2027, with maintenance extended until 2030, or run HCM in SAP S/4HANA via a compatibility pack until the end of 2025. After 2025, usage rights for the compatibility pack will end, and customers will need to choose another solution, such as SAP SuccessFactors. Customers can also choose to move forward with SAP HCM for SAP S/4HANA, which will be supported until 2040.

Becker noted that, for on-premises editions of SAP S/4HANA, the solution scope for SAP HCM includes support for most recent components, including personnel cost spending and simulation; there is no Java stack in SAP HCM for SAP S/4HANA, Becker added. That said, most functionality will remain largely unchanged in SAP HCM for SAP S/4HANA, and in particular enhancements for the 2022 SAP S/4HANA release will remain valid.

Becker also shared enhancements pertaining to payroll for direct deposit and a new table in time management, as well as re-designed Fiori apps for managers, employees and HR administrators that follow the UX guidelines and architecture of Fiori for SAP S/4HANA.

Dive into the full webcast, included with ASUG membership, here. And for further guidance on U.S. Tax Reporter Year End 2023, consult user guides and resources—available to SAP users in their support portals—including the SAP HCM U.S. Tax Reporter Solution Document, TR: 1099-R User Guides for HCM US Tax Reporter configuration, TR: W-2 User Guides for HCM US Tax Reporter configuration, TR: Tax Reporter User Guides for HCM US Tax Reporter configuration, FAQ: Troubleshooting PDF Forms in US Tax Reporter, and FAQ: Tax Reporter Note.

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