PA Act 32-W2 box20 has PSD Code from Work Tax Area instead of Residence Tax Area

Hello payroll-tax gurus,

Having issue with PA taxes:(

We have employees in Pennsylvania with a local service tax of PBHD-Ohara Township set up as the Tax Authority on IT0208 Work Tax Area.  On IT0207 Residence Tax Area we have set up the Township to be taxed (example PAUF-Harmony Twp).  The checks are processing with the correct taxes. 

When running the Quarter report in Tax Reporter the report pulls the employees’ Residence Tax but correctly but all under the one Work Tax Area location PBHD Ohara.  It is not breaking up the Residence Tax Areas onto separate reports. 

When we ran the W2s the Taxes in Boxes 18 and 19 were pulling the Residence Tax Area but the PSD Code in Box 20 is from the Work Tax Area.

Thank you so much for your help.