Starting Oct 1st, 2023, the WA state Department of Retirement has a new DCP Roth plan that is available for employees to contribute to. This article shows how to setup the DCP Roth plan in Advanced Payroll

The first step is to add a new benefit/deduction.

1. Click Advanced Payroll>Payroll Control Panel. Click the Cog Wheel in the upper right hand corner of the payroll window then click Setup. For on-prem users, click advanced payroll then Payroll Setup.
2. Click Add New.
3. Leave the plan number blank (SBX will assign a plan number) or put a plan number that has not been used yet in the Plan column.
4. Give the plan a name in the description column.
5. For the vendor account, enter the same vendor number as the Deferred Comp (if you have it) or double click the account number field and either select the vendor or add a new vendor.
6. Group = Retirement
7. Split = unchecked
8. Primary = unchecked as the entire deduction is employee paid.
9. Basis = wages
10. BARS codes = Bas  = 000 EL = 00 OB = 00 LA = 000 or 0000
11. Cap = yearly *** The cap is dependent on other factors. Does the employee and/or employer contribute to another DCP state plan? What is the age of the employee? Please visit the WA DRS Roth Information Website for more information regarding caps:   https://www.drs.wa.gov/plan/dcp/#limits ***
12. Pay item = blank as any employer matches should be entered as pre tax under the pre tax DCP.
13. SS, MED and FWT boxes = checked as the DCP Roth plan is post tax money.
14. W2 box = 12 and the W2 Code is EE.
15. W2 Include = Emp.
16. W2 Ret = unchecked.
17. Active = checked.
18. DRS Plan = blank.
19. Save (he Edit button will show Save when adding a new plan or editing a plan). Click Save

Below the Plans is the Settings tab:

1. Add New
2. Description = Unique (Unique is just the term we use when each person's contribution is different)
3. Save

The next step is to add this benefit/deduction to employees. This can be done from the deductions and benefits tab of an employee's record.

1. Add New
2. Choose the Roth plan or whatever name it was given in your system.
3. For Category, choose Unique.
4. Check the Save checkbox
5. Enter the employee's contribution in the EE Flat amount field or a percent in the EE decimal field (example: .04 = 4%).  If using a percent of wages contribution, a custom basis change may be needed in the Roth benefit and deduction setup under payroll setup. The custom basis allows users to choose which earning items would be included and which earning items would be excluded from the Roth deduction amount calculation. More information regarding Custom Basis benefit and deductions can be found at the end of this document.
6. Enter the yearly cap. *** the cap is based on a number of factors, including the amount contributed to the non Roth DCP plan. See the WA Dept of Retirement website for more information: https://www.drs.wa.gov/plan/dcp/#limits ***
7. Save

Custom Basis deduction and benefits: Custom Basis deduction and benefits allow users to choose which earning items are included in the calculation of benefit and deductions based on EE or ER decimal percentages. Let's say Reid wants to have 4% of his wages go toward the Roth benefit. In the EE decimal field, enter 0.04000. By default, the program will take all of Reid's earning items and multiply their total by 4% to come up with the Roth deduction. If some of Reid's earning items aren't going to be included in the total to multiply by the 4%, those earning items need to be excluded in the Custom Basis settings in the setup for the Roth deduction.  To set the Custom Basis, follow the steps below.

Return to the Payroll Setup by clicking Advanced Payroll>Payroll Control Panel. Click the Cog Wheel in the upper right hand corner of the payroll window then click Setup. For on-prem users, click advanced payroll then Payroll Setup.

1. Find the Roth Benefit/Deduction and click on it.
2. Click the Custom Basis button. The Roth Selected Items window appears
3. Click Write to show all the earning items to choose from.
4. Click Edit and check the box next to each earning item which is going to be included in the earning items to count toward the 4% Roth deduction amount.
5. When finished selecting the earning items, click Save which sets these earning items as the only earning items which will be used to calculate the 4% deduction.