What are payroll deductions?

What are payroll deductions? A payroll deduction is a reduction of income from an employee’s earnings, and deductions are the mechanism for collecting employee contributions to pay for benefits and/or taxes or other withholdings. In general, employers may take certain deductions from an employee’s wages as a matter of course (for example taxes based on […]

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2018 HSA contribution limit

What are payroll deductions?

A payroll deduction is a reduction of income from an employee’s earnings, and deductions are the mechanism for collecting employee contributions to pay for benefits and/or taxes or other withholdings. In general, employers may take certain deductions from an employee’s wages as a matter of course (for example taxes based on the employee’s elections in their Form W-4) while other deductions require employee to explicitly ask an employer to deduct an amount from their wages (such as a benefits-related deduction). Please consult with legal or employment counsel to learn more about what deductions employers are permitted to make.

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