HR Fast Facts: How Can I Immediately Resolve Under and Over-Deductions in Payroll?
Adjustment plans to resolve under and over-deductions in payroll could span several pay periods. Therefore, handling these adjustments directly in payroll is the fastest way to make these corrections.
Adjustment plans to resolve under and over-deductions in payroll could span several pay periods. Therefore, handling these adjustments directly in payroll is the fastest way to make these corrections.
Manually adjusting payroll to correct under-deductions
When an under-deduction is detected, we suggest an adjustment plan that increases the individual deductions at a rate of 2x their typical deduction.
Manually reimbursing employees for over-deductions
When an over-deduction is detected, we automatically suggest an adjustment plan that decreases their deductions at a rate of 2x their typical deduction. However, the best way to handle over-deductions is to reimburse the individual immediately for their overpayment. This can be done manually in your payroll account.
You will also need to contact your payroll provider to process reimbursements. Reimbursements for pre-tax deductions are more than simply paying back the overpaid amount in their next paycheck. You will need to correct the previous payroll information to account for the increase in taxable wages and taxes — your payroll provider can assist you with this.
