Skip to main content

Other Functions

Add A Deduction Code

Deduction codes are used to withhold amounts from employees' paychecks. Follow the steps below to add a deduction code.

  1. In Payroll, go to Other Functions then select Deduction Codes
  2. Press Add
  3. Enter a four digit code in the Code field
  4. Enter a name or description in the Desc field
  5. Choose a deduction type from the dropdown
  6. Use the Before/After Taxes dropdown to choose whether this deduction is subtracted after tax deductions, before income tax deductions, or before FICA/MDCR and Income Tax Deductions
  7. Choose a W2 code to specify how the deduction is reported on the employee W2
  8. If a percentage, use the Rate Table to enter max pay and the percentage
  9. Optionally, use the Combine with dropdown to combine the deduction with another deduction
  10. If the deduction should be reported as dependent care on the W2s, check the Dependent Care box
  11. If the deduction should be taken when bonus checks are created, check the Apply to Bonus Check box
  12. If the deduction is for medical insurance that must be reported as part of the affordable care act (ACA), check the ACA Health Insurance box
    • Choose an ACA Offer code with the ACA Offer Code dropdown
    • If ACA Low Cost, fill in the low cost section
  13. If you want to print a deduction check for the deduction, check the Print Check box
    • Enter the Provider Name and Address
  14. If you want to send the deduction to Budget as part of the auto-transfer check the Send to Budget box
    • Enter the budget account, contra account, vendor, and department
  15. Press Save

After the deduction is saved, you can add the deduction to your employees.

 

Field Definitions

Field Definition
Code A four digit number used to uniquely identify the deduction.
Desc The name or description of the deduction.
Deduction Type

Identify the type of deduction. The options are:

  • Fixed Amount
  • %-Gross Pay
  • %-Retirement Pay
  • %-Retirement Choice Plan
  • Amt-Retire Choice Plan
  • Amt-Retire Loan Payment
  • Amt-Retire Mandatory (invc)
  • %-Non Retire Pay
  • %-YTD Gross Pay
  • Adv Earned Inc Credit
  • Tips
Before/After Taxes

Specifies whether this deduction should be taken either before or after Federal and State income taxes. It may also be taken either before or after FICA and Medicare taxes. The options are:

  • After Tax Deduction
  • Before Income Tax Deduction
  • Before FICA/MDCR & Inc Tax Deduction
W2 Code

Determines how the deduction is to be reported on employees' W2s. The options are:

  • 401(k)
  • 403(b)
  • 457(b)
  • 408(k)
  • 501(c)
  • Retirement
  • Section 125 Plan
  • Roth 401(k)
  • Roth 403(b)
  • Roth IRA
  • HSA Health Save Acct
  • ACA Affordable Care Act
Combine With Deduction

This deduction can be combined with another deduction. Select the other deduction from this field.
Dependent Care

Check this box if the deduction should be reported as dependent care on the W2s.
Apply to Bonus Check

Check this box if this deduction is to be taken when “bonus” pay checks are created.
ACA Health Insurance

Check this box to indicate that the deduction is for medical insurance that must be reported as part of the affordable care act (ACA).
Rate Table

Deductions that are a percentage of pay can be taken on a graduated basis, or can be taken up to a specific maximum amount of pay by specifying the amount of pay. Enter the maximum amount of pay and the rate that corresponds with that amount.
Print Check

Check this box if a check is to be printed to the provider of this deduction. If this box is checked the “Send to Budget” checkbox cannot be checked at the same time.
Provider Name

The name to print on the deduction check.
Address 1-3

The address to print on the deduction check.
Send To Budget

Check this box if the amount for this deduction is to be transferred to Budget Manager as part of the Auto-Transfer process. If this box is checked, the “Print Check” box cannot be checked.
Bdgt Acct

The budget account number that this deduction amount will be credited to when the auto-transfer is performed.
Contra Acct

The budget contra-account number that this deduction amount will be debited to when the auto-transfer is performed.
Bdgt Vend

The budget vendor that this deduction amount should be tied to when the auto-transfer is performed.
Bdgt Dept

The budget department code that this deduction amount should be tied to when the auto-transfer is performed.
Transfer to Detail/AP

The deduction amount can be transferred to detail records (general ledger), or to accounts payable, so a check can be printed for the total amount.
ACA Offer Code

What type of coverage is offered. This will usually be “1A”.
ACA Low Cost

Lowest cost of employee only coverage. There are two of each of these fields so that if the cost or type of coverage changed during the year, you can specify the months when each type of coverage was provided under this deduction code.
Beg Mo

Beginning month of coverage.
End Mo

Ending month of coverage.
Type

Fully-insured or self-insured.

 

Related articles