payACH for Taxing Entities

payACH is a great product used by various taxing and water districts to aid in the collection of funds via electronic bank-draft operations.  Customers are asked to provide their bank-draft details and the taxing authority will configure a record to request funds from that account for a individual recurring schedule, allowing the application to stop the transaction after X number of payments or on a continual basis.

Here is an example of the process:

Create a batch (group) of transactions

payACH New Batch

The first step is to add a new batch (also considered a grouping of transactions).  On this screen, you can setup the name of the group of transactions, identify that this will be a recurring set of transactions by choosing a Recurring Payment from the drop down.  Since most payments recur monthly, we’ll configure a monthly recurring schedule and assume a 10-month payment plan would be used (all of these values can be adjusted).  If you’ll note, the Globally Assigned for this Batch check mark is un-checked for the effective date – this allows you to define the date of the individual tax payer/water customer will draft their funds.

The Transaction Code of PPD is the typical value used for the banking Automated Clearing House system (ACH).  The offset record details may not be required, depending on what your local bank would like to have in the file.  This section defines the bank account the funds will be deposited into or taken out of.

Detail Records

Once you have the bank draft details from your customer (or a paper check), you add their details to the Batch Details section of the application.  In here, the “Location #” should reflect the account number in your accounting system.  This can be used during an import process to update the existing records.  The “Location Name” refers to the tax payer’s name, the amount is the recurring or fixed amount.  The “Account #” and “Routing #” fields are provided by the bank draft details either from the paper check or from the auto-draft form.

The Prenote check box allows you to submit a $0.00 transaction to notify the payer’s bank that future transactions will occur. By checking this value, the system will save the amount you entered and temporarily set the amount value to $0.00 for this record.  Upon Saving to Queue, the system will revert the amount back to the original value and turn off the prenote flag.

The DDA/Savings check boxes define if the funds are being pulled from a Checking (DDA) account or a Savings account.  Choose one or the other (but it is typically a DDA).

Credit/Debit check boxes – this defines if you are giving money to this bank account (credit) or taking money from them (debit).

payACH Detail Screen

If you have selected in the Batch Header screen that the recurring record has its own recurring schedule, you will see the Occurrence drop down (which you can select a different recurring schedule for each record), the next payment Effective Date and how many payments to be made (or -1 for infinite).  The Paid Times column is tracked as payments are made and the Order column is used to customize the order the records are displayed on the screen.

Once the records are added, you can now press the “Save to Queue” button to select a date range of records that will be paid in this specific week/period of time – you may need to check with your bank if they want a single file per day or if they can accept multiple days at one time – ie, a week’s worth of transactions on Monday).  If the detail records have a different set of effective dates, you are asked to choose the date range to send out.

payACH Choose Date options

Once the system generates the file, you will see it separated the transactions into multiple batches.  You can then release all of them into one file or one at a time and deliver it to the bank.

Batch Queue with Two Batches

Requirements to use payACH

To effectively use payACH, you will need to:

  • Verify with your bank you can deliver a NACHA-formatted file
  • Find out from the bank the values for the Bank Originator Number and the Fed Routing number details
  • Determine the cost per file delivered to your bank (the bank may charge $25/file)

payACH is licensed with a yearly renewal fee.  See the payACH download page for details on the fees.  Typically, the Standard Edition will cover most of the initial needs.   Want to find out more information about the free 60-day license?  Click here. Need more help, please call 972-242-8090 x 2 (sales)