Is it possible to enter additional local tax rates for paychecks

Yes, you can enter different city tax rates for each employee .

You can follow this guide and add a new deduction "City tax". You can specify the tax rate from employee set up.

How to add a new payroll deduction and withhold it from each paycheck automatically
http://www.halfpricesoft...w-payroll-deduction.aspx 

Please feel free to contact us if you still have any questions.

---