Setting Up Deductions for Wage Attachments

This chapter provides an overview of deductions for wage attachments setup and discusses how to:

• Set up garnishment deductions.

• Set up fee deductions.

• Set up tax levy deductions.

• Set up wage assignment deductions.

Understanding Deductions for Wage Attachments Setup

Before you can enter wage attachment information for employees, you must set up a deduction for each type of wage attachment. Setting up a deduction for a wage attachment is similar to setting up any other kind of deduction. Therefore, only the unique considerations for each type of wage attachment deduction are discussed here.

Wage attachment payments are deducted from an employee's disposable wage (disposable earnings). An employee's disposable wage is the amount that remains after all payments that are required by law have been deducted from the employee's gross wages.

These required payments include:

• Federal income tax.

• Social Security tax.

• Medicare tax.

• State income tax.

• State unemployment insurance.

• State disability insurance.

• State employee retirement systems.

• Local and county taxes.

• Any other applicable state requirements.

Special considerations for a wage attachment deduction include:

You set up a garnishment deduction to deduct court-ordered payments resulting from nonpayment of personal debts or overdue child support. The debts on which these imposed payments are based are already past due.

In some cases, you might need to associate fees with a wage attachment. For example, your organization might charge fees for administering garnishments.

You set up a tax levy deduction to deduct court-ordered payments for back taxes that the employee owes.

You set up a wage assignment deduction to deduct ongoing debts, including child support and maintenance, from an employee's earnings.

Setting Up Garnishment Deductions

This section provides an overview of garnishment deduction setup, lists a prerequisite, and discusses how to set up garnishment deductions.

Understanding Garnishment Deduction Setup

You set up a garnishment deduction to deduct court-ordered payments resulting from nonpayment of personal debts or overdue child support. The debts on which these imposed payments are based are already overdue. Because each deduction must match the court orders, you might need to set up separate deductions for different employees.

When you set up a garnishment deduction, you can use a garnishment table to calculate the amount to withhold, or you can set up the deduction without a table, and use the wage attachment method to calculate the amount to withhold.

Prerequisite

Set up the tables that the system uses to calculate garnishments.

See Setting Up Garnishment Tables.

Form Used to Set Up Garnishment Deductions

Setting Up Garnishment Deductions

Access the Basic DBA Information form.

To set up a garnishment deduction:

1. On the Basic DBA Information form, enter a numeric code from 1 to 7 in the Source of Calculation field.

2. Enter G in the Method of Calculation field.

3. Enter the attachment table number for your garnishment tables in the Table Code field.

   If you do not want to use a table to calculate the garnishment amount, enter NOTBL in this field. If you do not attach a garnishment table to the DBA, the system uses the method and amount information that you enter using the Employee Wage Attachments Review program (P07107) to calculate the garnishment.

4. Complete the steps for setting up essential DBA information.

Setting Up Fee Deductions

This section provides an overview of fee deduction setup and discusses how to set up fee deductions.

Understanding Fee Deduction Setup

In some cases, you might need to associate fees with a wage attachment. For example, your organization might charge employees administrative fees for maintaining garnishments.

You set up deductions for fees, and you base those deductions on the deductions for which you are collecting the fees. Fees do not apply to tax levies.

A fee deduction must have a higher DBA number than the deduction on which it is based. For example, you can base fee deduction 1120 on garnishment deduction 1104. You can base a fee deduction on only one deduction. Therefore, even when you charge the same fee for garnishments as for wage assignments, you must set up two fee deductions. Base one fee deduction on the garnishment deduction, and base the other fee deduction on the wage assignment deduction. You specify the based-on deduction number in the basis of calculation for the fee deduction.

When you define a wage attachment for an employee, you assign the fee deduction number to the associated wage attachment.

Forms Used to Set Up Fee Deductions

Setting Up Fee Deductions

Access the Basic DBA Information form.

To set up a fee deduction:

1. On the Basic DBA Information form, enter 0 (zero) or R in the Source of Calculation field.

2. Enter $ or % in the Method of Calculation field.

3. Complete the steps for setting up essential DBA information.

4. Select Basis of Calc. from the Form menu.

5. On the Basis of Calculation form, complete the From PDBA and Thru PDBA fields for the wage attachment deduction for which you are collecting the fee.

6. Click OK.

Setting Up Tax Levy Deductions

You set up a tax levy deduction to deduct court-ordered payments for back taxes that the employee owes. You set up a tax levy deduction in the same way that you set up any other type of deduction.

This section lists a prerequisite and discusses how to set up tax levy deductions.

Prerequisite

Set up exemption tables.

See Setting Up Exemption Tables.

Forms Used to Set Up Tax Levy Deductions

Setting Up Tax Levy Deductions

Access the Basic DBA Information form.

To set up a tax levy deduction:

• On the Basic DBA Information form, enter 1, 2, 3, or 8 in the Source of Calculation field.

• Enter L (tax levy) in the Method of Calculation field.

• Enter 2 (mandatory) in the Effect on Disposable Wage field.

• Complete the steps for setting up essential DBA information.

Setting Up a Wage Assignment Deduction

This section provides an overview of wage assignment deduction setup and discusses how to set up wage assignment deductions.

Understanding Wage Assignment Deduction Setup

You set up a wage assignment deduction to deduct ongoing debts, including child support and maintenance, from employees' earnings.

The courts typically rule that child support has priority over other types of wage attachments. This situation means that if an employee did not earn enough in a pay period to pay for all deductions, the child support deduction should be the last deduction to be adjusted.

To give the child support deduction first priority, assign it a lower DBA number than the numbers that you enter for other deductions. During payroll-cycle processing, the system adjusts (backs out) deductions in numerical order, beginning with the highest-numbered deduction. For example, deduction 1001 would be adjusted (backed out) before 1000.

You set up a wage assignment deduction in the same way that you set up any other type of deduction.

Form Used to Set Up a Wage Assignment Deduction

Setting Up a Wage Assignment Deduction

Access the Basic DBA Information form.

To set up a wage assignment deduction: :

1. On Basic DBA Information, enter a numeric code from 1 to 8 in the Source of Calculation field.

2. Enter C in the Method of Calculation field.

3. Complete the steps for setting up essential DBA information.