The following instructions detail how to set up local codes.

1. Enter a code that will identify a city, county, or other local taxing district in the Local Code field.
2. Enter the description of the code in the Description field.
3. In the Tax ID # field, enter the identification number that will be used for reporting taxes to this locality. You can leave this field blank.
4. Enter the locality's state in the State field.
5. Enter a local income tax deduction code in the Tax Dedn field. Press F4 for a list of valid local income tax codes.
6. From the Calculation Option drop-down, select an option for processing local deductions and liabilities associated with the local code. For more information on calculation options, see Calculation Option.
7. Select the correct tax type from the Tax Type drop-down.
8. In the Taxing Entity field, enter the taxing entity code as defined by the local agency. For more information, see Taxing Entity.
9. Enter additional deductions and liabilities to be calculated for the local code on the Add'l Local Based Dedns/Liabs tab, DLCode field.
   Note: The option you select in the Calculation Option drop-down does not apply to the deductions and liabilities on this tab.
10. Save the record as normal.