Deduction Code Maintenance Home | FAQs & Troubleshooting

 

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How Do I...
	Process Pension Plan and Cafeteria Plan Deductions		Apply Deduction Codes to Employees
	Set Up Nonqualified Deferred Compensation Plan Deduction		Reimburse Employees
	Set Up Qualified Dependent Care Deduction		Set Up Deductions to Create A/P Invoices

 

Related Topics
	Fringe Benefits		Apply Deduction to Employees
	Calculation Based on Earnings Types		Tax Rules for Deduction Codes
	Deduction Codes for Disposable Wage Calculation

Overview

Use Deduction Code Maintenance to create codes for voluntary payroll deductions (credit union deposits, insurance, etc.), and to establish calculation methods for each deduction. Voluntary deductions can be permanent and ongoing, or temporary and discontinued after the maximum amount of the deduction specified in the employee record has been reached (for example, repayment of a salary advance).

Do not use Deduction Code Maintenance for nonvoluntary deductions (federal and state withholding tax, Social Security, etc.). Nonvoluntary deductions are maintained in the tax calculation engine.

You can click the Apply button to validate a record and automatically write it to the Employee file for a specified range of employees. This saves time if you want to apply a deduction code or change the standard limit amount or rate for a group of employees.

You can calculate deductions based on specified earnings types by clicking the Earnings button and selecting the earnings types to use in the calculation.

To create Accounts Payable invoices for the deduction so that you'll have an easy way to create checks for it, click the A/P Invoice button. The button is available if the (Integrate with) Accounts Payable check box is selected in Payroll Options.

You can click the Deductions button to select which non-employer contribution deductions to include in the calculation of disposable wages. The button is available if Percentage of Disposable Wages is selected at the Calculation Method field.

After entering deduction codes, you can click the Print button to print the Deduction Code Listing.

Note When a deduction using the Percentage of Net Wages calculation method causes the check amount to be negative, the deduction amount is adjusted so that the check amount is equal to zero.

Fields

 

Deduction Code Description Deduction Type Calculation Method Standard Amount/Rate Standard Limit Apply to W-2 Box Box 12 Code Deduction Code to Use Employee Pay Rate

Maximum Income Multiplier Certified Payroll Benefit Type Reset Balance at Year End Equal to Earnings Code Frequency of Deduction Automatically Apply Deduction to Earnings Code Deduction Accrual Account Contribution Expense Account Tax Rule