Setting Up Payback Deduction and Earnings Codes

This example illustrates the steps required to set up a payback deduction code and associate it with a corresponding payback earnings code. It describes how to define an earnings code for salary advance (ADV) and create a salary advance payback deduction code (ADVPB):

1. Define the ADVPB deduction code in the Deduction table and indicate arrears information.

   Enter a flat dollar amount or a percentage to indicate the maximum amount to deduct.

   See Setting Up Deductions.

2. Define the ADVPB deduction code in the General Deduction table with a flat dollar deduction amount of zero, unless you specify a dollar amount to take in addition to the actual payback amount, which you enter in the Deduction table.

   See Defining General Deductions.

3. Create the ADV earnings code in the Earnings table.

   Enter ADVPB as the payback deduction code on the Earnings Table - Taxes page for the ADV earnings code.

   See Establishing Earnings Codes.

   Note:

   The system creates the advance payback as a before-tax deduction if the earnings code associated with it has the Subject to FWT (subject to federal withholding tax) check box selected. If you deselect this check box, the deduction is after-tax.